Filecrat

non-profit seeking companies or section 8 companies are created for the promotion of charitable objects of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment, etc. These companies intend to apply their profit in promoting its objects and intend to prohibit the payment of any dividend to its members.

the central government has delegated the power to grant license of a section 8 company to the roc. Such companies do not have limited or private limited to their name. A section 8 company enjoys a number of privileges not available to a profit seeking company. For e. G. Such companies have a number of relaxations in terms of compliance and benefits under income tax law.

advantages & benefits:

1. most reliable form of a charitable organization since it is regulated by companies act.
2. no such criteria for requirement of minimum share capital
3. no requirement to have minimum number of directors
4. ownership is easily transferable
5. under the income tax act, section 8 company enjoys more tax benefits
6. no requirement to pay stamp duty in some states
7. objectives are clear for easy donations and loans requirement
8. several exemptions and privileges under companiesact 2013
9. relaxation in many compliances
10. exemptions in gst
11. a registered partnership firm can become a member in a section 8 company
12. can call general meeting by giving 14 days notice instead of 21 days
13. no need to constitute nomination and remuneration committee and shareholders relationship committee