Certificate of Commencement of Business

Certificate of Commencement of Business (Form INC-20A): Complete Guide for FY 2026-27

Every company incorporated on or after 2 November 2018 with a share capital must file Form INC-20A — the Declaration for Commencement of Business — with the Registrar of Companies (ROC) within 180 days of the date of incorporation. Until this filing is approved, the company is legally barred from starting any business activity or exercising borrowing powers. Miss the deadline and the company faces a Rs. 50,000 penalty, every director in default faces up to Rs. 1,00,000 each, and the ROC can initiate strike-off proceedings under Section 248 of the Companies Act 2013.

What Is Form INC-20A — and Who Must File It

Form INC-20A is the statutory vehicle through which a director declares to the ROC that all subscribers to the Memorandum of Association (MoA) have paid the full value of shares agreed to be taken by them. The requirement originates from Section 10A of the Companies Act 2013, inserted by the Companies (Amendment) Ordinance, 2018, operative from 2 November 2018.

One clarification up front: "Certificate of Commencement of Business" is a colloquial shorthand inherited from the old Companies Act 1956. Under the current regime, the ROC does not issue a separate certificate — the acknowledgement of an approved INC-20A filing is itself the proof of compliance with Section 10A. If someone asks you for your "commencement of business certificate," hand them the INC-20A approval acknowledgement.

Companies that must file INC-20A:

• Private limited companies incorporated after 2 November 2018
• Public limited companies incorporated after 2 November 2018
• One Person Companies (OPCs) with share capital incorporated after 2 November 2018
• Foreign subsidiary companies incorporated in India after 2 November 2018
• Producer companies and Nidhi companies with share capital incorporated after 2 November 2018

Companies that do not need to file:

• Companies incorporated before 2 November 2018 (Section 10A does not apply retrospectively)
• Section 8 companies (companies limited by guarantee — no share capital)
• Limited Liability Partnerships (LLPs) — governed by the LLP Act 2008, which has no equivalent declaration requirement

The 180-Day Clock: When It Starts and What Trips You Up

The 180-day window starts from the date of incorporation printed on your Certificate of Incorporation (CoI). It is not the date you submitted SPICe+ online, not the date your CIN was generated, and not the date you received the CoI email — it is the date that appears on the face of the CoI document itself.

Calculating your deadline:

A common error is counting six calendar months instead of 180 days. April + 6 months = October 1, but 180 days from April 1 = September 28. That three-day gap can be consequential if you are filing close to the deadline.

The 180 days run continuously. Section 10A contains no extension provision. In FY 2026-27, no general extension circular is operative. The only exceptions that have historically applied were MCA circulars during COVID-19, which are not in force now. Treat the 180-day limit as absolute.

Pre-Conditions You Must Satisfy Before Filing

Filing INC-20A before these conditions are met risks a false declaration — a much graver problem than a late filing. Verify all of the following are in place before the director signs.

1. Subscription money fully received in the company's bank account

Every subscriber named in the MoA must have transferred the full subscription amount to the company's bank account before the director signs the declaration. This is not a statement of intent — it is a declaration of fact. The bank statement you upload must show a credit from each subscriber, ideally with a narration or sender name that identifies them unambiguously.

2. Company bank account opened in the company's own name

You need a current account in the company's name, not in any director's or promoter's personal account. Banks require the Certificate of Incorporation, PAN card, MoA and AoA, board resolution for bank account opening, and KYC of signatories. Plan to open the account within the first 10 days of incorporation — delays here cascade directly into a late INC-20A.

3. Registered office verified under Section 12

Section 10A(1)(b) requires that the registered office verification under Section 12(2) be completed before INC-20A is filed. If you declared the registered office address within the SPICe+ form at the time of incorporation — which is standard practice today — this condition is already satisfied. If you did not, file Form INC-22 (verification of registered office) within 30 days of incorporation, and do so before submitting INC-20A.

4. Valid Class 3 DSC of the declaring director

The director signing INC-20A must have a valid Class 3 Digital Signature Certificate (DSC) that is registered on the MCA V3 portal. Check both the DSC expiry date and the DIN (Director Identification Number) status on the MCA portal. A deactivated DIN — which happens automatically if DIR-3 KYC is not filed annually — will block submission completely.

5. Certificate from a practising professional with valid CoP

INC-20A must be certified by a practising Chartered Accountant (CA), Company Secretary (CS), or Cost Accountant (CMA) holding a valid Certificate of Practice (CoP). A fellow member of ICAI or ICSI who does not hold a CoP cannot certify the form. Verify the professional's CoP validity before engaging them — this is a detail that often surfaces only at the last minute.

6. Sectoral approvals in place (where applicable)

Companies in regulated sectors (RBI for NBFCs, SEBI for stock brokers, IRDAI for insurance, DoT for telecom) need the relevant licence before commencing regulated operations. INC-20A can be filed within 180 days even if the licence is pending, but actual regulated business must not start until both the INC-20A approval and the sectoral licence are obtained.

Step-by-Step: Filing INC-20A on MCA V3

The MCA V3 portal (mca.gov.in) is the filing interface for INC-20A for all companies in FY 2026-27. Here is the process as it currently stands:

1. Log in to MCA V3 with the director's credentials. Your login must be linked to your DIN. If you have not registered on MCA V3, complete the user registration and DIN association first — this alone can take 2-3 days.

1. Navigate to Company e-Filing. Go to MCA Services → Company e-Filing → Company Forms Filing. Use the form search to locate "INC-20A."

1. Enter your CIN. The Corporate Identity Number (CIN) auto-populates the company name, registered office address, and date of incorporation. Cross-verify these against your Certificate of Incorporation — any mismatch must be resolved before proceeding.

1. Complete the director's declaration. The form requires the signing director to declare that every subscriber to the MoA has paid the value of shares agreed to be taken by them. Read the declaration carefully before checking the box — this is a statutory declaration and carries personal liability.

1. Attach the company bank statement. Upload a clear, complete PDF of the company's bank account statement showing:
2. The company's name as the account holder
3. A credit entry for each subscriber, for the exact subscription amount
4. The sender's name or account details identifying the subscriber
5. The date of each credit (must be on or before the declaration date)

1. Attach the practising professional's certificate. The CA/CS/CMA must prepare their certificate on letterhead, stating their membership number, CoP number, and a declaration certifying the facts in INC-20A. The professional affixes their DSC digitally.

1. Affix the director's DSC. Select the Class 3 DSC registered on MCA V3 for the declaring director. Ensure your DSC token is connected and the driver is installed before you reach this step.

1. Pay the government fee. The filing fee for INC-20A is Rs. 200 (flat, as notified under the Companies (Registration Offices and Fees) Rules, 2014 — irrespective of authorized capital). Pay through the MCA payment gateway using net banking, UPI, or card.

1. Submit and record the SRN. On submission, a Service Request Number (SRN) is generated immediately. Save this SRN — it is your tracking reference for the ROC's processing queue.

1. Download the approval acknowledgement. Once the ROC processes the form — typically 5 to 10 working days, varying by jurisdiction — it is marked "Approved" and an email is sent to the company's registered email. Download and archive this acknowledgement permanently. It is the company's proof of Section 10A compliance.

Government Fees and Professional Costs

The government filing fee for INC-20A is Rs. 200 — a flat fee regardless of the company's authorized capital. This is significantly lower than most other MCA filings, which scale with authorized capital.

For companies with non-resident subscribers requiring FIRC documentation and FEMA compliance review, professional fees will be higher. This cost context matters when comparing it against the penalty exposure below.

Penalties for Non-Filing: A Worked Rs. Example

The statutory position under Section 10A(2):

• Company: A flat penalty of Rs. 50,000
• Every officer in default: Rs. 1,000 per day for each day of continuing default, subject to a ceiling of Rs. 1,00,000 per officer

Beyond monetary penalties, Section 10A(3) empowers the ROC to initiate strike-off proceedings under Section 248 if no INC-20A has been filed within 180 days and the ROC has reasonable cause to believe the company is not carrying on any business. Strike-off terminates the company's legal existence.

Worked example — TechNova Private Limited:

TechNova Private Limited is incorporated on 5 April 2026. Its 180-day deadline is 2 October 2026. The company has two directors — Arjun and Priya — both of whom are officers in default. Due to poor post-incorporation planning, the company eventually files INC-20A on 10 January 2027, exactly 100 days after the deadline.

TechNova saved Rs. 200 by not filing INC-20A on time. Its eventual compliance cost is Rs. 2,50,000 — a 1,250-fold return on the avoided fee, entirely in the wrong direction.

On adjudication: Since the Companies (Amendment) Act 2020, monetary penalties under the Companies Act are adjudicated by the Regional Director (RD) or the Registrar of Companies, not by the NCLT. Section 10A penalties are civil penalties — not "offences" — and therefore cannot be compounded under Section 441. Once levied, they must be paid. There is no composition route, no waiver provision, and no instalment scheme currently notified.

INC-20A in the Post-Incorporation Compliance Calendar

INC-20A is the final gate before a company can operate, but it sits within a broader chain of first-180-day obligations. Missing an earlier obligation can block INC-20A.

The critical dependency chain is: bank account opened → subscription money credited → bank statement generated → professional certificate obtained → INC-20A filed. A delay at step one flows through every subsequent step.

For companies with three or more co-founders, coordinating subscription money transfers — especially if any founder is travelling or abroad — can consume 10-20 days. Build in a buffer: target Day 150 as your INC-20A filing date, not Day 179.

Edge Cases and Special Situations

One Person Companies (OPCs)

An OPC incorporated after 2 November 2018 with share capital must file INC-20A. Since the sole member and sole director are typically the same individual, the subscription money flows from the member's personal account to the OPC's bank account. The sole director signs the declaration. The process is identical to a multi-member private company, just with one set of bank credits to evidence.

Non-Resident and Foreign Subscribers

If any subscriber is a foreign national or a Non-Resident Indian (NRI), the subscription amount must arrive through the banking channel and you will need:

• A Foreign Inward Remittance Certificate (FIRC) or a bank credit advice identifying the foreign remittance
• KYC documents of the overseas subscriber
• Compliance with the applicable Foreign Direct Investment (FDI) policy under FEMA 1999 — verify that the sector is FDI-eligible under the automatic or approval route
• Filing of Form FC-GPR with the Authorised Dealer bank (for onward submission to RBI) within 30 days of allotment of shares

Do not file INC-20A until the FIRC is in hand and the foreign credit is visible in the company's bank statement. A pending FIRC means the bank statement cannot confirm receipt of foreign subscription money, and the declaration would be premature.

Regulated Sector Startups

A fintech startup seeking an NBFC licence from RBI, or an insurance broking firm seeking IRDAI registration, cannot commence regulated business without both INC-20A approval and the sectoral licence. The right sequencing is:

1. File INC-20A within 180 days using the company's subscription capital as proof — this is not the same as commencing regulated business
2. Simultaneously apply for the sectoral licence
3. Begin operations only after both INC-20A approval and the regulatory licence are in hand

Filing INC-20A is a declaration of readiness, not a declaration that business has commenced. You will not be in violation of regulatory requirements by filing INC-20A before your sectoral licence arrives.

Companies That Receive a Strike-Off Notice Before Filing

If the ROC issues a strike-off notice under Section 248(1) because 180 days have elapsed and INC-20A has not been filed, the company can appeal to the National Company Law Tribunal (NCLT) under Section 252 for revival. Revival requires demonstrating legitimate cause and paying all outstanding penalties. This process typically takes several months and costs substantially more than timely compliance would have. It is not a fall-back plan — it is an emergency exit.

Common Mistakes That Cause Rejection or Penalty

In practice, INC-20A filings fail or attract post-filing scrutiny for a predictable set of reasons. Check each one before submission.

• Filing before subscription money is actually credited. The declaration states money has been paid — past tense, completed fact. If the bank credit arrives after the director signs, the declaration is factually false. Always verify the bank statement on the day of signing, not the day of intent.

• Bank statement does not identify the subscriber. A statement showing "NEFT credit – Rs. 5,00,000" without the sender's name is insufficient. Ask your bank to include the sender's account holder name in the statement, or obtain a stamped pay-in slip that names the subscriber.

• Counting from the SPICe+ submission date instead of the CoI date. There can be a gap of 3-7 days between submitting SPICe+ and receiving the CoI. The CoI date is the only legally relevant start date. Check it.

• Director's DIN is deactivated. Directors who have not filed Form DIR-3 KYC annually will find their DIN deactivated. The MCA V3 portal will not accept a DSC from a director with a deactivated DIN. Run a DIN status check at mca.gov.in before beginning the filing.

• Practising professional lacks a valid Certificate of Practice. A CA fellow who has not renewed their CoP, or a retired CS, cannot certify INC-20A. Confirm CoP validity at the ICAI or ICSI member portal before engagement.

• Incomplete bank statement uploaded. The bank statement must cover from account-opening date to a date on or after all subscriptions were received. A statement that shows only partial credits, or that has pages missing, will cause the ROC to raise a query — delaying approval and potentially pushing you past the 180-day mark.

• Foreign subscription routed through a third-party account. FDI regulations under FEMA require the subscription amount to come from the subscriber's own overseas account. Routing through a relative's Indian account or through an agent constitutes a FEMA violation independent of the INC-20A issue.

• Not completing ADT-1 before INC-20A. Technically, INC-20A can be filed without the auditor appointment being complete, but doing so leaves the company in a non-compliant state on a parallel obligation. File ADT-1 first, then INC-20A — it creates a clean compliance trail.

Key Takeaways

• INC-20A is mandatory for every company with share capital incorporated on or after 2 November 2018 under Section 10A of the Companies Act 2013 — no exemptions, no extensions currently operative in FY 2026-27.
• The 180-day deadline runs from the date printed on the Certificate of Incorporation — count exact days, not calendar months.
• The subscription money must be in the company's bank account before the director signs the declaration; filing before receipt is a false statutory declaration, not merely a procedural lapse.
• Penalty exposure is disproportionate: Rs. 50,000 (company) plus up to Rs. 1,00,000 per officer per default — and these penalties cannot be compounded or waived once adjudicated.
• The ROC can initiate strike-off under Section 248 if INC-20A is not filed within 180 days — making this a business-ending compliance failure in the worst case.
• Non-resident subscribers require FIRC, FEMA compliance, and eventual FC-GPR filing — all of which must be sequenced before INC-20A is submitted.
• Build your post-incorporation compliance calendar on Day 1: bank account within 10 days, subscription money within 30 days, first board meeting and auditor appointment within 30 days, INC-20A filed by Day 150 — leave a 30-day buffer before the statutory deadline.