Critical Analysis of Section 8 of The Companies Act, 2013

By Poojashree G, Christ University.*

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Abstract

In India, under the registrar of Societies or as a private limited non-profit company under section 8 company under the Companies Act, 2013 a non-profit organisation can be registered as trust by executing a Trust Deed. It is the same as section 25 company under the old companies Act, 2013 which has become section 8. Under section 8 (1a,1b,1c) of the new Companies Act, 2013 anyone can establish section 8 company for “promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object”, provided it intends to apply its profits, if any, or other income in promoting its objects” and “intends to prohibit the payment of any dividend to its members”. The process for the registration of these companies is similar to the incorporation of other companies. A Section 25 company's formation, management, and responsibility are governed by this comprehensive Act, which makes it subject to stricter oversight and regulation than trusts and societies and is recognised globally.

Keywords : Section 8, The Companies Act 2013, Incorporation, Non-Profit Organisation, Section 25

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* The author is a third-year student pursuing BBA. LL.B. from Christ University.

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