ONE-PERSON-COMPANY-1

One Person Company​

with No Comment

Article explains Section and Rules of Company Law Applicable to One Person Company (OPC), Forms Applicable to One Person Company (OPC), FAQs on One Person Company (OPC) and Points to be kept in mind while drafting MOA and AOA of OPC.

Section and Rules of Company Law Applicable to One Person Company (OPC) Rule 3, 4, 5, 6, 7 of the Companies (Incorporation) Rules 2014 and Section 18 for conversion of OPC

Forms Applicable to One Person Company (OPC)

INC-3

INC-4

INC-5

INC-6

Consent of Nominee

Change in Member/Nominee

Intimation to ROC on exceeding threshold limits

Application to ROC for conversion

FAQs on One Person Company (OPC)

Q 1. Who can incorporate One Person Company? Or Who can be member of OPC?

Ans- Rule 3 of Companies (Incorporation) Rules 2014 provides that: 

     1. Only a natural person; (should not be minor)

     2. Indian citizen; 

     3. Person Resident in India;

Q 2. Who can be nominee of OPC? 

Ans-  Rule 3 of Companies (Incorporation) Rules 2014 provides that: 

        1. Only a natural person; (should not be minor) 

        2. Indian citizen; 

        3. Person Resident in India

NOTE: A person can be member of one OPC only at a time but he can be nominee of other OPC. A person cannot act as member or nominee of more than one OPC at a time. 

Q 3. What is the criterion to determine Person Resident in India?

Ans- Explanation 1 of Rule 3 of Companies (Incorporation) Rules 2014 specifically provides that “Person Resident in India” means a person who has stayed in India for a period of 182 Days in immediately preceding financial year.

Q 4.  Is it mandatory to appoint Nominee in case of OPC?

Ans- Yes, it is mandatory to nominate a person, (who shall meet the criteria as discussed above), at the time of incorporation, with his prior consent in the Form INC-3. 

Nominee is a person who shall, in the event of Death of member or his incapacity to enter into contract, become the member of OPC. 

Nominee may at anytime withdraw his consent, by giving notice to member and OPC as well.

Q 5. What are the various cases of change of nominee? 

Ans. Following are the cases where new nominee require to be nominate In case nominee withdraw his consent: 

a) Nominee may at any time withdraw his/her consent, by giving notice to Member and Member shall within 15 Days from the Date of receipt of Notice of withdrawal of consent, nominate a new nominee, with his prior consent in Form INC 3 and give intimation to company about such nomination. 

b) Company shall within 30 Days from the date of receipt of notice of withdrawal of consent, file with the Registrar, notice of withdrawal of consent in Form INC 4, along with consent of new nominee in Form INC 3. 

2. If sole member change nominee on its own: 

a) Sole member at any time by giving notice to company, change the name of person nominated by him (nominee) and nominate new nominee, with his prior consent in Form INC 3. 

b) Company shall within 30 Days of receipt of notice of such change, file with the Registrar, notice of such change in Form INC 4, along with consent of new nominee in Form INC 3.

3. In case of death of member or his incapacity to enter into contract: 

a) Where sole member ceases to be member because of Death or his incapacity to enter into contract or for any other reason, his nominee become member of OPC and such new member shall, within 15 Days of becoming member, nominate a new nominee with his prior consent in Form INC 3, who shall in the event of his death or incapacity to enter into contract become member of such company. 

b) Company shall within 30 Days of change in membership, file with the Registrar, notice of such cessation and nomination in Form INC 4, along with consent of new nominee in Form INC 3.

Q 6. Can OPC be incorporated as Public Limited Company? 

Ans- No. 

2(62) of the Companies Act 2013 defines “One Person Company”, means a company which has only one person as a member. 

2(68) “private company” means a company having a minimum paid-up share capital as may be prescribed, and which by its articles,— 

(i) restricts the right to transfer its shares; 

(ii) except in case of One Person Company, limits the number of its members to two hundred: 

(iii) prohibits any invitation to the public to subscribe for any securities of the company; 

1. Thus OPC can be incorporated only as a Private Limited Company having one person as a member only.

2. No OPC can be incorporated as public company or as Section 8 Company (Company not for Profit). 

3. OPC cannot be incorporated as Holding Company or Subsidiary Company (either wholly owned or partially owned subsidiary).

4. No OPC can be converted into Section 8 Company. 

5. “One Person company” required to be mentioned in bracket below the name of company. Example – XYZ TRAVELS (OPC) PRIVATE LIMITED

Q 7. What are the restrictions in carrying on the activity of OPC? 

Ans– 1. OPC cannot carry on NBFC related activities. 

2. OPC cannot acquire/invest in securities in its own name in other body corporate however member can invest in the shares of other body corporate. 

3. OPC cannot issue or allot shares to anyone except its member.

Q 8. What is the provision of conversion of OPC? 

Ans- Two methods of conversion are there:

A) Voluntary Conversion 

B) Mandatory Conversion 

a) Voluntary Conversion: An OPC can voluntarily converts itself into Private or Public Company, provided 2 years must have elapsed since incorporation. 

In simple words, An OPC, after completion of 2 Years from the Date of Incorporation, can convert itself into Private or Public Company. 

An application in this regards to be made in Form INC-6, pursuant to Section 18 of Companies Act, 2013 and Rule 7 Companies (Incorporation) Rules 2014. 

b) Mandatory Conversion: 

i) If at any time after incorporation, Paid up Share Capital of company exceeds 50 L Rs. OR its average annual turnover of preceding 3 consecutive financial year exceeds 2 cr. Rs, it ceases to continue as OPC.

ii) Intimation of exceeding threshold limit required to be given to ROC in Form INC-5 within 60 Days from the day on which limit exceeds. 

iii) Application for conversion of OPC into Private/Public Company to be made in Form INC-6, within 6 Months from the effective date on which the threshold limit exceeded.

Q 9. What are the various benefit/exemption provided to OPC? 

Ans- 1. Cash Flow Statement is not required to be prepared as a part of their Financial Statement. 

2. OPC can have only one Director at the Board. Board Resolution can be passed by entering it into minute book, which shall be signed and dated by Director and such date deemed to be meeting of Board of Director. 

3. Provision of section 98 and section 100 to 111 (both inclusive) not apply to OPC. 

4. Resolution, either Special Resolution or Ordinary Resolution, can be passed simply by member by communicating resolution to company and by entering it into minute book, which shall be signed and dated by sole member. 

5. Financial statement of OPC is required to be signed by one Director only if there is one Director on the Board.

6. Abridged list of content for opc and small company. (MCA vide its notification dated 31, July 2018, has brought Companies (Accounts) Amendment Rules, 2018 and inserted Rule 8A to Companies (Accounts) Rules 2014 which contain the matters to be included in Board Report.)
7. Unlike other companies, at least one Board Meeting required to conduct in each half calendar year, however the gap between two meeting should not be less than 90 Days (If there is two or more than two Director at the Board)

Q 10. What are the various documents/information required to incorporate an OPC? 

Ans- 

1. Digital Signature of member; 

2. Self attested PAN & Aadhaar;

3. Proof of Identity of sole member – Voter ID/Driving License/Passport; 

4. Proof of Address of sole member – Electricity Bill/Mobile Bill/Telephone Bill/Bank Statement; (any document should not be older than 2 months) 

5. Proof of Identity of nominee 

6. Proof of Address of nominee 

7. Email ID and Phone No. of sole member; 

8. Email ID and Phone No. of nominee; 

9. Passport size photo; 

10. Consent to act as Director in Form DIR-2; 

11. Consent of Nominee in Form INC-3; 

12. Rent Agreement of Registered Address; (if Rented/leased), ownership document (if owned) 

13. NOC of owner if taken on rent/lease; 

14. Utility Bill of Registered Address proof; 

15. Proof of appointment of Authorized Signatory for GSTN; (mandatory for Agile Pro)

16. Proof of Identity of Authorized Signatory for opening Bank Account;

17. Proof of Address of Authorized Signatory for opening Bank Account;

Points to be kept in mind while drafting MOA and AOA of OPC 

1. All documents should be self-certified. 

2. Object entered in MOA should be in consonance with object entered in SPICe Part A. 

3. An OPC cannot carry on NBFC activity remove these points from MOA. 

4. An OPC cannot issue/allot securities to any person except its member, remove these points from AOA. 

5. An OPC cannot invest or acquire in securities of any body-corporate, remove these points from MOA & AOA. 

6. Definition of OPC as per Section 2(62) along with definition of Private Company as per 2(68) must be mentioned in AOA.

FSSAI-Logo-1

Fssai License

with No Comment
FSSAI eligibility, Application for License/Registration, Validity, Suspension or Cancellation of License and Transfer of License.

♣   APPLICATION FOR FSSAI REGISTRATION: 

1. The petty food manufacturer along with application for registration provides a self attested declaration of adherence to requirements related to general hygiene and sanitary requirements with the application.

2. On application for registration, Registering authority either grants registration or rejects it or issue notice for inspection, within 7 days of receipt of an application for registration.

3. In the event of an inspection being ordered the registration shall be granted by the Registering Authority within a period of 30 days after being satisfied with the safety, hygiene and sanitary conditions are being complied with. 

4. The petty food manufacturer may start its business, subject to compliance of any improvement suggested later by registering authority in the following cases:

Where registration is granted. 

Where registration is not granted, or not rejected or inspection not ordered within 7 days of application 

Where no decision is ordered by Registering Authority within a period of 30 days in case of inspection order.

♣   APPLICATION FOR FSSAI LICENSE:

1. An application for the grant of a license shall be made in Form B it will be accompanied by a self-attested declaration and such copies of documents (FOR STATE LICENSE AND CENTRAL LICENSE) along with the applicable fees as prescribed. 

2. On the receipt of a complete application, (including any additional information if demanded by Licensing Authority) the Licensing Authority shall issue an Application ID number to each applicant. 

3. A license shall, be issued by the concerned Licensing Authority within a period of 60 days from the date of issue of an application ID. 

4. An applicant may commence his food business and the concerned licensing Authority shall not deny the applicant to commence such business, if license is not issued within 60 days.

♣   VALIDITY OF FSSAI REGISTRATION / LICENSE: A Registration or license shall be valid for a period of 1 to 5 years as chosen by the Food Business Operator from the date of issue of registration or license.

♣   APPLICATION FOR RENEWAL OF FSSAI REGISTRATION / LICENSE: 

1. Any application for the renewal of a registration or license shall be made not later than 30 days prior to the expiry date of License/registration. 

2. The Registration or License shall continue to be in force till such time that the orders are passed on the renewal application which in no case shall be beyond 30 days from the date of expiry of registration or license. 

3. Any renewal application filed beyond the period mentioned above but before the expiry date shall be accompanied by a late fee of Rs 100 per day for each day of delay. 

4. If renewal application not applied, license shall expire and the Food Business Operator shall stop all business activity.

5. If FBO wants to restart the business the Food Business Operator will have to apply for fresh Registration or license.

♣   SUSPENSION/CANCELLATION OF FSSAI LICENSE OR FSSAI REGISTRATION: 

1. Registering or Licensing Authority may at any time suspend any registration or license if there is reason to believe that the Food Business Operator has failed to comply with the conditions within the period mentioned in any Improvement Notice served u/s 32. 

2. Registering authority may cancel the license/registration, if Food Business Operator has still failed to comply with the conditions of the improvement notice issued by authority within the period mentioned in such Notice. 

3. After a period of 3 months from the date of cancellation, the Food Business Operator may make fresh application for Registration or license if all observations made in the improvement notice have been complied with.

♣   TRANSFER OF LICENSE / REGISTRATION IN THE EVENT OF DEATH: 

1. In the event of death of the holder of a Registration certificate or license, such certificate or license shall subsist for the benefit of the legal representative or any family member of the deceased or until the expiry of:— 

(i) the period of 90 days from the date of death of the holder of a Registration certificate or license; or 

(ii) such longer period as the Designated Officer may allow, for reasons to be recorded in writing. 

2. The legal representative or family member of the deceased holder shall apply to the concerned Authority for transfer of such certificate or license in his favor.

♣  COMPLIANCE TO BE DONE:

1. Every licensee shall on or before 31st May of each year, submit a return electronically or in physical form in ‘Form D-1’ 

2. Every licensee engaged in manufacturing of milk and/or milk products shall file half yearly returns for the periods 1st April to 30th September and 1st October to 31st March of every financial year in the form D-2. 

However, for the F.Y. 2019-2020 authority has extended the timeline for submission of annual return and half yearly return for the period from 1st October to 31st March,till 31st July, 2020. Click Here to read notification 

3. A separate return shall be filed for every license issued, if same Food Business Operator holds more than one license. 

4. Any delay in filing return beyond 31st May of each year shall attract a penalty of Rs 100 per day of delay.

Section 8

Section 8 Company – NGO

with No Comment

Section 8 of Companies Act, 2013 provides: Where it is proved to the satisfaction of the Central Government that a person or an association of persons proposed to be registered under this Act as a limited company—

(a) has in its objects the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object;

(b) intends to apply its profits, if any, or other income in promoting its objects; 

(c) intends to prohibit the payment of any dividend to its members, the Central Government may, by license issued in such manner as may be prescribed, and on such conditions as it deems fit, allow that person or association of persons to be registered as a limited company under this section without the addition to its name of the word “Limited”, or as the case may be, the words “Private Limited”, and thereupon the Registrar shall, on application, in the prescribed form, register such person or association of persons as a company under this section.

REGISTRATION:  Like Trust and Society, Section 8 Company is also a legal form that NGO generally takes. This Form of organization is governed by Companies Act, 2013. These are the Limited Companies registered under Companies Act.

CONDITIONS: Following conditions required to satisfy in order to get register under Section 8 company 

1. Main object of such company should be related to the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object and 

2. Profits or 

3. No dividend any other income earned from its operation should be applied in promoting its object and shall be distributed by such company to its members.

USE OF WORD “LIMITED” OR “PRIVATE LIMITED” : Central Government may, by issuance of license and on such condition as CG deems fit, allow to be registered as Limited Company without using the word “LIMITED” or “PRIVATE LIMITED” to its name.  

LIABILITY OF MEMBERS: Section 8 company can be registered only as either “Company Limited by Shares” or “Company Limited by Guarantee” meaning thereby that Liability of members of section 8 company shall be limited to the extent of share subscribed for by each member of the company or to the extent of their contribution in case of Company limited by Guarantee.

APPLICABLE SECTION AND RULES: 

Section 8 read with Rule 8A, 19 of Companies (Incorporation) Rules, 2014 

APPLICABLE FORMS/DOCUMENTS AND INFORMATION: 

Form INC 13 – Memorandum of association in 

Declaration in INC 14 (by CA/CS/CMA in Practice or by advocate) 

Declaration in INC 15 (by each person making application) 

Estimated Income and Expenditure for next 3 Years 

Form INC 9 – Declaration by all Subscribers and first Directors (Auto generated in PDF format) 

Form DIR 2 – Consent to act as Director in 

Article of Association 

Rent Agreement or Ownership Paper, as the case may be 

NOC of Landlord 

Address Proof of Registered Address 

List of Promoters (KYC Documents) 

List of Directors (KYC Documents and DIN, if any) 

Mail Id and Phone No. of above persons 

ID and Address Proof of above persons 

Passport Size photograph of person

PROCEDURE:

 1. NAME APPROVAL:

Application for approval of Name is to be made in SPICe Plus “Part A”. According to Rule 8 of Companies (Incorporation) Rules, 2014, proposed name of Section 8 Company should include the word Foundation, Forum, Association, Federation, Chambers, Confederation, Council, Electoral Trust and the like, etc.

Earlier, such proposed companies requires to make an application for issue of License to CG (ROC) in Form No. INC 12 to incorporate such type of company without addition to its name the word “Limited” or “Private Limited” But MCA, vide its notification no. 411 (E) dated 07.06.2019 has done away such requirement and such application for License is now merged with SPICe Plus Form.

2. APPLICATION FOR INCORPORATION OF COMPANY: 

Application for incorporation to be made in SPICe Plus “Part B” along with various attachments as stated above. 

3. APPLICATION FOR COMMENCEMENT OF BUSINESS: 

After receiving Certificate of Incorporation Directors of Company require to file a Declaration in e-Form INC-20A with ROC within 180 Days from the date of Incorporation.

ngo-registration.jpg

Registration of NGO as Society​

with No Comment

INTRODUCTION:

Like Trust and Section 8 Company, Society is also a legal form that NGO generally takes. A society is an association of several individuals combined for the promotion of a common cause without any monetary gain. Such form of organization is governed by the Societies Registration Act, 1860. Societies are usually registered for the advancement of charitable activities like sports, music, culture, religion, art, education, etc..

PURPOSE FOR CREATION OF SOCIETY:

According to section 20 of Society Act, 1860, a society registration can be done for following purposes: 

Grant of Charitable Assistance: Creation of military orphan funds 

Promotion of science, literature: Foundation or maintenance of libraries 

Promotion of fine arts for instruction: Foundation or maintenance reading-rooms for general use among the members or open to the public

Diffusion of useful knowledge: Public museums and galleries of paintings and other works of art

Collections of natural history:  Mechanical and philosophical inventions

ELIGIBILITY AND REQUIREMENT TO FORM A SOCIETY:

Minimum number of 7 Person may by subscribing their name to the memorandum of association forms a society under this Act. Such memorandum of association is required to be filed with Registrar of Joint-stock Companies.

PROCEDURE TO FORM A SOCIETY:

 

1. NAME SELECTION AND ITS APPROVAL FROM REGISTRAR:

When selecting a name for society registration, it is vital to understand that according to Society Act, 1860, an identical or similar name of a currently registered society will not be allowed. Moreover, the proposed name shall not suggest for any patronage of state government or government of India or fascinate the provisions of Emblem & Names Act, 1950.

2. PREPARATION OF MEMORANDUM OF ASSOCIATION:

Memorandum of association is a charter of Society. It contains the following clauses, i.e. 

Name Clause, 

Object Clause of Society 

Registered Office Clause 

Governing Body Member clause (The governing body of the society shall be the governors, council, directors, committee, trustees or other body to whom by the rules and regulations of the society the management of its affairs is entrusted.) 

3. PREPARATION OF RULES AND REGULATION (By-Laws):

Rules and Regulation Section includes the following items: 

Membership Clause, their tenure, manner of cessation of membership

Meeting Clause

Governing body clause, their composition, power

4. OTHER DOCUMENTS:

Copy of Resolution for Registration of Society; 

Copy of Resolution Authorizing a person to make application for registration;

List of Members of Society along with their address; 

Rent Agreement or Registered Paper (If owned) 

NOC from Land Lord (If Rented)

5. SUBMISSION OF DOCUMENTS FOR REGISTRATION:

Memorandum of Association along with Rules & Regulation to be filed with respective Registrar of Society. Copy of Rules & Regulation of Society should be certified by at least 3 members of the governing body of the Society. Registrar on being satisfy that proper documents have been filed with it, approve the application and grant Certificate of Registration to the Applicant.

POST COMPLIANCES TO BE DONE:

Post compliances of the Society vary from State to State. However, following are the list of some general compliance to be done:

1. Hold Board Meeting of Society every year 

2. Hold Annual general Meeting every year 

3. Once in every year, within 14 Days from the Date of Annual General Meeting (Tenure of General Meeting prescribed by Rules) a list of members shall be filed with the Registrar of Society. 

4. Maintain proper accounts of Society 

5. Maintain Minutes of Board Meeting and General Meeting of Society 

6. Filling of ITR

NGO or Non-Governmental Organization to Serve Specific Social and Political Needs in Template Hand Drawn Cartoon Flat Illustration

Registration of NGO as Trust

with No Comment

A trust can be either private or public. Private trusts are governed by the Indian Trusts Act, 1882 and are used for private purposes, such as running a private estate or institution. For doing a charitable work for public, Public charitable trusts can be set up. India doesn’t have a national level law to govern charitable trusts, however; few states have enacted Public Charitable Trusts Act and NGO trust registration has to be done.

♦ BASIC CONCEPT BEHIND TRUST AND GENERAL TERMS: 

♦  Author/settler of Trust: Any person who is competent enough to enter into contract can be Author of trust. Any person with the permission of principal Civil Court of original jurisdiction may create a trust on behalf of a minor.

♦  Trustees: Every person capable of holding property may be a trustee. Trustee can accept trust by words or by way of an act. He is bound to fulfill the purpose of trust for which it is created. There is no educational qualification is prescribed in law thus even an illiterate person capable to enter into contract can be appointed as trustee.

♦  Beneficiaries:  According to Indian Trust Act, 1882 any person capable of holding property can be beneficiary. In case of Public Trust, beneficiaries include general public at large.

♦  Trust Property: Trust Property is the subject matter of trust. Trust can be created for both type of property, i.e. either moveable property or immoveable property.

♦  Trust Deed: It is an instrument of trust by which trust is declared. To register a trust, memorandum has to be prepared first. It defines the relationship of the Author with the Trustees and specifies the objectives for which such a Trust is formed. Trust Deed contains various clauses such as Name clause, Registered Office Clause, Settler and Trustee Clause, Object Clause and Beneficiaries, General Body Member Clause and other Rules and regulations.

♦ ELEMENTS OF TRUST DEED:

Name of Trust 

Name and Address of Author of Trust 

Name and Address of Trustees appointed 

Minimum and Maximum number of Trustees (When the administration of the trust involves the receipt and custody of money, the number of trustees should be at least two) 

Name of Committee/Governing Body of Member 

Address of Registered Office of Trust 

Purpose Behind formation of Trust

Objectives of Trust 

Information related to opening of Bank Account 

Membership and Subscription Clause 

Procedure of appointment, removal, resignation, replacement of Trustees 

Right and Duties of Trustees 

Obligation of Trustees »  Manner of Alteration of Trust Deed 

Number of Meeting 

Quorum for meeting 

Manner of appointment of Auditor for Trust…..etc

Trust Deed shall be prepared on non judicial stamp paper of appropriate value.

♦ DOCUMENTS REQUIRED FORREGISTRATIONOF TRUST: 

>>  Identity Proof of Author 

>>  Identity Proof of Trustees 

>>  Rent Agreement or Registration Paper of Property 

>>  Address Proof of Property 

>>  NOC from Landlord (If Rented) 

>>  Passport Size Photo of Author and Trustees

♦ PROCEDURE TO CREATE A TRUST HAVING CHARITABLE OBJECT:

>>  SELECT NAME OF TRUST: Choose appropriate name for your Trust. While choosing name ensure that name of Trust should not be under the restricted list of names as per the Provision of Emblem and Names Act, 1950 

>>  SELECT AND DETERMINE NUMBER OF TRUSTEES: Determine the trustees for your trust. Minimum number of trustees should be 2 (Two). There is no restriction on maximum number of trustees in the Trust Act. 

>>  PREPARE TRUST DEED: Prepare Memorandum of Association and Rules & Regulation (Buy-Laws) for your trust which is also known as Trust Deed. This instrument is very essential as it is the legal evidence of your trust formation. Deed shall be prepared on stamp paper of appropriate value. Value of Stamp paper shall be certain percentage of total value of trust property which varies from State to State.

>>  REGISTER WITH SUB-REGISTRAR: For registration of trust deed, Trustees and Author of trust along with 2 witnesses required to present before sub-registrar office have having jurisdiction based on registered office of the Trust along with properly attested photocopy of trust deed and have to pay registration fee for this purpose. Proof of registered address and NOC of Landlord (if Rented) should be attached with the Trust Deed. 

>>  APPLY FOR PAN & TAN OF TRUST: On registration of Trust Deed, the logical step is to apply for PAN & TAN of Trust and to open Bank Account for the trust.

♦ BENEFIT OF REGISTRATION: Income of registered NGOs either as Public Trust or Society or Section 8 Company are exempted from the tax. Tax exemptions can only be provided to the registered trust under new Section 12 AB and 80G of the Income Tax Act. Income Tax registration is mandatory to avail certain tax exemption.

Credibility will be more if the trust is registered as it involves money of individuals in the form of donations.

360_F_517800097_fwM6sVbiDbn4PeELvTg6vavOhFfRIJ2r

NGO (Non Governmental Organization)

with No Comment

♣  NGO (Non-Government Organization): A non-governmental organization (NGO) is an organization that is not part of a government. They are non-profit making, voluntary and service oriented organizations. Many NGOs now prefer the term Private Voluntary Organization (PVO). A non-governmental organization (NGO) is a legally constituted organization created by natural or legal persons that operates independently from any government. NGOs which are funded totally or partially by governments, the NGO maintain its non-governmental status by excluding government representatives from membership in the organization.

The World Bank defines NGOs as “Private organizations that pursue activities to relieve suffering, promote the interests of the poor, protect the environment, provide basic social services, or undertake community development.”

♣  AREA OF WORK: The NGOs perform various functions for the benefit of society. NGO typically works on various issues like Environment protection, Save the Planet Earth, Disability, Science and Technology, Health, Agriculture, Animal welfare, Art and Culture, Education, Age care, Rural development, Culture and heritage, Women empowerment, Child care, Basic education to all children, Animal welfare, Disaster management and many more.

♣  SOURCES OF FUNDING OF NGO:

A) Internal sources:

1. Membership fees,

2. Subscription,

3. Any short term or long term investment of NGO,

4. Donations by member of the NGO,

5. Rent from property of NGO, (If rented)

B) External sources:

External sources include:

1. Funds from Government,

2. Funds from Foundations/Trusts/Funding Agencies,

3. Funding from Corporations,

4. Public donations,

5. Self financing etc

♣  GOVERNING LAWS FOR NGOs: NGO registration in India can be done under following acts: Indian Trust Act, 1882 if registered as Trust Societies Registration Act, 1860 if registered as Society Companies Act, 2013 if registered as Section 8 Company (Company not for Profit)

♣  TYPES OF ORGANIZATION:
Non-Government organizations (NGOs) in India generally take three legal forms:

Trusts,

Societies, and

Not-for-profit companies (Section 8 Companies)

♣  REGISTRATION OF SUCH ENTITIES/ORGANISATIONS UNDER VARIOUS ACTS:

 ⇒ Registration under Income Tax Act: In order to take exemption of Income Tax on any income derived from property held under trust for charitable or religious purpose, such organization/institution/entities require to get itself registered under Section 12AB of Income Tax Act, 1961 

Trust or an institution which is already registered under section 12A or under section 12AA, of the Income Tax Act, 1961, require to make an application for registration again within a period of 3 Months from the 1st Day of June, 2020 i.e. till 31st August, 2020 and it shall be valid for a period of 5 years from the date of registration (Amendment by Finance Act, 2020) 

⇒  Registration under FCRA: Charitable Trusts, Societies, Section 8 Company which proposes to receive Foreign Contribution or donation from foreign sources is required to obtain registration under Section 11 of Foreign Contribution Regulation Act, 2010. Such a registration under the Foreign Contribution Regulation Act, 2010 is called a FCRA registration.

⇒  Registration of NITI AAYOG: Every NGO need not to mandatorily register with NITI AAYOG. However in order to receive Fund from government under various government schemes, NGO and other voluntary organization required to register with NITI AAYOG. Niti Aayog is now appointed as the nodal agency for the purpose of registration and accreditation of NGOs/voluntary organizations seeking funds from the government.

♣  TAX BENEFITS TO ORGANISATIONS ENGAGED IN CHARITABLE OBJECTS:
To be eligible for tax exemption under the Income Tax Act (1961), a not-for-profit entity must be organized for religious or charitable purposes. “Charitable purpose” includes relief of the poor, education, yoga, medical relief, preservation of environment (including watersheds, forests and wildlife) and preservation of monuments or places or objects of artistic or historic interest, and the advancement of any other object of general public utility as defined under Income tax Act, 1961 

Exemption from Tax: Any income derived from property held under trust for charitable or religious purpose shall not be included in the total income of the person who is in receipt of such income subject to compliance of such conditions/restrictions as mentioned u/s 11 and 12 of IT Act, 1961. 

Any voluntary contributions received by a trust or by an institution established wholly for charitable or religious purposes shall be deemed to be income derived from property held under trust and shall not be included in the total income of the previous year.

Conditions to take Tax benefit: A Trust or an institution is not eligible to take tax benefit, unless such trust or an institution has made an application for registration electronically. Application for registration is to be made at least one month prior to the commencement of the previous year relevant to the assessment year from which said registration is sought. Trust or an institution must file its timely Income Tax Return. The Books of Accounts should be properly maintained, including all receipts and expenditures.

Fssai license

All about food license

with No Comment

REGULATORY FRAMEWORK :
The Food Safety and Standards Authority of India is a statutory body under Food Safety and Standards Act, 2006. The Food Safety and Standards Act (FSS), 2006 is the primary law for regulation of food products. The Food authority regulates and checks for safe food manufacture, storage and handling practices of Food Business Operators (FBOs). FSSAI checks for compliance and that FBOs are following the regulations and standards as mentioned in the Food Safety and Standards Act, 2006 The FSSAI functions under the administrative control of the Ministry of Health and Family Welfare. The main aim of FSSAI is to 

1. Lay down science-based standards for articles of food 

2. To regulate manufacture, storage, distribution, import and sale of food 

3.  To facilitate safety of food

APPLICABLE FSSAI LICENSE : FSSAI issues three types of license based on the nature of food business and turnover: 

1. Basic FSSAI Registration: For Turnover less than ₹12 Lakh

2. State License: For Turnover between ₹12 Lakh to ₹20 Crore 

3. Central License: For Turnover above ₹20 Crore 

FSSAI issues a 14-digit License number to food business operators who are in compliance of the rules and regulations under the FSS act. To overcome the adulteration in the food and poor products, FSSAI has addressed it compulsory to get this license.

APPLICABLE FORMS FOR APPLICATION : 

Form A – This for is for Basic FSSAI Registration 

Form B – It is required for State and Central License 

Form IX – Form IX is the nomination form that is to be submitted forward with the FSSAI application. 

The owner of a food business can nominate an employee of the business to be in charge of the establishment or the unit. Such a nominated person is responsible for food safety or any contravention of the FSSAI Act. 

However, FSSAI by its notification Dated, 18-Sept-2018, has clarified that Form IX is not required where food business is operated by a Proprietorship Firm as Proprietorship is a business enterprise that is owned and controlled by one person who possess the entire Authority  and Responsibility w.r.t. business.

FSSAI LICENSE / REGISTRATION ELIGIBILITY : 

Many times as a Food Business Owner, it is difficult to decide what license to go for State or Central. Here, eligibility criteria are listing down so that you can determine up your kind of business and proceed to apply your food license.

NO LICENCE , ONLY REGISTRATION REQUIREMENT

FOLLOWING CATEGORY OF BUSINESSES HAVING TURNOVER UP TO 12 Lacs PER ANNUM: 

1. Petty Food Business Operators 

2. Temporary or fixed stall 

3. Hawker – Selling packaged or freshly prepared food by travelling (usually on foot or movable carts) from one location to other location. 

4. Vegetable Oil Processing Units 

5. Meat Processing 

6. Storage – Cold/Refrigerated/with or without Atmospheric Controlled 

7. Wholesaler – distribution of food product from manufacturer to retailer 

8. Distributor –  distribution of food product from original  place of manufacture to person who makes the final delivery or to final consumer

9. Supplier – distribution of food product to consumer as per  requirements raised by the consumer. 

10. Retailer of food product 

11. Marketer – promoter of food product 

12. Hotels, Restaurant and Bars, Club/Canteen, Mid Day Meal Canteens 

13. Food Agencies 

14. Dhaba 

15. Dairy unit including Milk Chilling Units processing Upto 500 Ltrs of Milk per day or Upto 2.5 MT of Milk Solids per annum

KIND OF BUSINESS

1. Dairy Units including Milk Chilling Units

2. Vegetable Oil Processing Units

3. Meat Processing where  processing of slaughtered animals/poultry birds into meat & meat products 

4. All Food Manufacturing/ Processing units other than above three category

5. Storage – Cold/Refrigerated

6. Storage – Atmospheric Controlled + Cold 

7. Storage Without Atmospheric Controlled + Cold

8. Wholesaler – distribution of food product from manufacturer to retailer 

9. Distributer, Supplier, Retailer, Marketer of food product.

10. Hotels 

11. Restaurant and Bars 

12. Club/Canteen, Dhaba, Mid Day Meal Canteen

13. Caterer, Mid day Meal Caterer 

14. Food Vending Agencies 

15. Importer/Exporter of Food Item

16. Food Business Activities at premises of Central Govt Agencies 

17. Food Business Activities at premises of Airport/Seaport 

18. E-commerce 

19. Food Business Operators having food business activities in two or more States/UTs have to declare one Head Office/Registered Office. 

Criteria to obtain STATE LICENSE 

processing 501-50,000 Ltrs. Of Milk per Day or 2.5 – 2500 MT Milk solid per Annum 

which process upto 2 MT per Day

upto 500 KG Meat per Day or upto 150 MT meat per Annum

with Production capacity upto 2 MT per Day 

with Storage Capacity Upto 10,000 MT 

with Storage Capacity Upto 1,000 MT 

with Storage Capacity Upto 50,000 MT 

Having Turnover more than 12 Lacs but upto 30 crore per Annum 

Having Turnover more than 12 Lacs but upto 20 crore per Annum 

having rating of One Star, Two Star, Three Star, Four Star

Having Turnover more than 12 Lacs but upto 20 crore per Annum 

Having Turnover more than 12 Lacs per Annum 

Having Turnover upto 20 crore per Annum 

Having Upto 100 Vending Machines in only one State/UT

NA

NA

Criteria to obtain CENTRAL LICENSE

Processing of More than 50,000 Liters of Milk per Day or More than 2500 MT of Milk Solid Per Annum 

 2 MT per Day

More than 500 KG Meat per Day or More than 150 MT meat per Annum

with Production capacity more than 2 MT per Day except grains, cereals and pulses milling units Annum

with Storage Capacity more than  10,000 MT 

with Storage Capacity more than  1,000 MT 

with Storage Capacity more than 50,000 MT

Having Turnover more than Rs. 30 Crores per Annum 

Having Turnover more than Rs. 20 Crores per annum 

Five Star and Above 

Having Turnover more than Rs. 20 Crores per Annum 

Having Turnover more than 12 Lacs per Annum 

Having Turnover more than Rs. 20 Crores per annum 

More than 100 Vending Machines and/or located in two or more States/UTs

Importing or Exporting any type of food product with no limit on the capacity

No limit on Capacity or Turnover

Process-for-Shifting-of-Registered-Office-of-LLP

Procedure for Shifting of Registered Office form One State to Another​

with No Comment

This article is all about complete procedure to be followed  for shifting of Registered Office from One State/UT to Another State/UT in accordance with Section 13 of Companies Act, 2013, and Company (Incorporation) Rules, 2014. 

Applicable Sections: Sec 13(4) and 13(5) of Companies Act 2013. 

Applicable Rules: Rule 30 and 31 of Companies (Incorporation) Rules, 2014.

Approvals/consent required: 1. Approval of Board of Director of Company. 

2. Approval of members at General Meeting. 

3. Consent/NOC from Creditors/Debenture Holders.

4. Approval of Central Government (power has been delegated to Regional Director) 

Applicable Forms:

1. MGT-14 

2. GNL-2 

3. INC-26 (Format of Newspaper Advertisement) 

4. INC-23

5. INC-22 

6. INC-28 

Procedure: BOARD MEETING: 

Call Meeting of Board of Director and pass following Board Resolution: 

1. To Approve the Shifting of Registered office from One State / UT to another State / UT. 

2. To alter the Registered Office Clause of Memorandum subject to approval of members in General Meeting. 

3. To authorize a Professional to make application to Central Government. 

4. To approve the notice of General Meeting. 

5. To authorize a Director of Company to call General Meeting.

GENERAL MEETING AND SPECIAL RESOLUTION: 

Send Notices to Members and hold General Meeting to seek following approval as Special Resolution:

1. For shifting of Registered office from One State / UT to another State / UT 

2. Alter the Registered Office Clause of Memorandum of Association of Company. 

FILING OF RESOLUTION UNDER SECTION 117 

File e-form MGT-14 as per Section 117 of Companies Act 2013, within 30 Days from the date of passing Special Resolution and prepare and sign minutes of that meeting  within 30 Days from the Date of passing resolution.

SUBMISSION OF PETITION TO ROC:

File e-form GNL-2 to ROC for submission of petition to Registrar. 

LIST OF CREDITORS, DEBENTURE HOLDERS: 

Prepare a List of creditors, debenture holders specifying their name, address, nature and amount of debt due to them. 

List is to be drawn with latest practicable date preceding the date of filing of application to CG in INC-23 

In simple words, Gap between the Date of determining the List of creditors, debenture holders and the Date of Filing of application to RD should not exceeds 30 Days.

PUBLICATION OF ADVERTISEMENT ISSUE OF NOTICE TO CREDITORS AND SERVICING OF PETITION TO AUTHORITIES: 

Company shall not more than 30 Days before the date of Filing of Application to RD in INC-23, complete following activities: 

1. Publish a newspaper advertisement in Form No. INC-26 in Vernacular Newspaper in Principal Vernacular Language in the district and in English language in English Newspaper with wide circulation in the state where Registered Office of the Company is situated at the time of filing petition. 

2. Serve an Individual Notice on each creditor and debenture holder by registered post with acknowledgement due. 

3. Serve a copy of application to ROC, Chief Secretary of State or UT where Registered Office of the Company is situated at the time of filing of application and to SEBI, in case of Listed Company and to other regulatory body, if company is regulated under special act/law for the time being in force.

APPLICATION TO RD:

File an application to RD for seeking approval for alteration of Clause II i.e. Registered Office Clause of MOA with regards to shifting of Registered Office of the Company from one state /  UT to another in Form INC-23, within 30 Days of finalizing List of creditors. 

ORDER, WHEN NO OBJECTION RECEIVED: 

Where no objection received from any person in response to advertisement and notices, application may be put up for order without hearing and the order shall be passed within 15 days of receipt of application. 

HEARING, IF OBJECTION RECEIVED: 

Where an objection has been received from any person in response to advertisement and notice, CG shall hold hearing and direct the company to file affidavit to record consensus reached at the hearing and approve it within 60 Days of filing application.

Attachments to various Forms

Form No.

MGT-14

GNL-2

INC-23

INC-28

INC-22

Attachments

Copy of SR along with explanatory statement

Altered MOA

Minutes of General Meeting

Copy of petition

Copy of Altered MOA & AOA 

Copy of BR

Copy of Notice of General Meeting 

Copy of Special Resolution along with Minutes 

Affidavit Verifying Petition 

Affidavit verifying List of Creditors, secured or unsecured 

Affidavit verifying no statutory dues 

Affidavit for non-retrenchment of employees

Affidavit in term of Section 13(5) 

Affidavit in term of Rule 30 

Affidavit that no investigation, inquiry is pending against company 

List of creditors (not older than 30 Days) 

List of Directors 

CA Certificate verifying 

List of Creditors 

Copy of Newspaper Advertisement in INC -26 Acknowledgement of Serving a 

copy of petition to ROC and Chief Secretary

Memorandum of Appearance

Certified Copy of Order of CG

Rent Agreement 

NOC from Owner, If Rented 

Utility Bill (not older than 2 Months)