Govt eases rules for incorporating not-for-profit cos

The government today eased rules for incorporating not-for-profit companies, by giving the Registrar of Companies the power to directly issue licences.

Besides, it has reduced the time taken for setting up Section 25 companies by doing away with some mandatory provisions, Ministry of Corporate Affairs Joint Secretary Avinash Srivastav told reporters here.

"Now, the power to issue licence under section 25 companies has been delegated to Registrar of Companies...It will reduce the time taken in incorporation of Section 25 companies [Companies not for profit]. The 30-day mandatory notice period before incorporating such a company has also been done away with," Srivastav said.

At present, any company seeking approval for issue of licence under Section 25, makes an application to Regional Director (RD) in eForm 24A. The application is then processed and approval/rejection order is passed by the RD concerned.

Further, Srivastav said that the ministry has also taken initiatives to refund fees wrongly paid by the stakeholders while availing various services at MCA 21.

It is also working on ensuring that 'Dormant Companies' -- companies that have not been filing their annual reports for 3 consecutive years -- do not file for new company name in anyway.

Besides, the MCA has also introduced payment of stamp duty fee for Jammu and Kashmir, mandatorily in electronic manner through MCA 21 e-portal system.

"Now 30 States and UTs are covered by estamps leaving only 2 States and 2 UTs [Nagaland, Goa, UTs Daman & Diu and Dadar & Nagar Heveli]," it said.