Commencement of Business Certificate (INC-20A): Complete Guide for New Companies

After incorporating a Private Limited or OPC in India, one of the first mandatory compliance requirements is obtaining the Commencement of Business Certificate by filing Form INC-20A with the Ministry of Corporate Affairs (MCA). This certificate legally allows a company to start operations, receive investments, open a current account, and conduct business activities.

In this article, we cover everything you need to know — including the process, documents required, due dates, penalties, and FAQs.

What Is the Commencement of Business Certificate?

The Commencement of Business Certificate is an MCA-issued approval that confirms a newly incorporated company has received its share capital from the shareholders and is ready to start business.

It is filed through Form INC-20A, which must be submitted after the company’s incorporation but before starting operations.

Who Needs to File INC-20A?

The following companies must file INC-20A:

Private Limited Companies
One Person Companies (OPC)
Section 8 Companies (if having share capital)
Public Companies

LLPs do not need to file this form.

Why Is the Commencement Certificate Important?

Filing INC-20A is crucial because:

It legally allows the company to start business
Required to open a current bank account
Needed to receive share capital from shareholders
Mandatory for raising loans or investments
Helps avoid penalties and legal issues under Companies Act, 2013

Without this certificate, banks may reject account opening requests and the MCA may restrict the company’s operations.

INC-20A Filing Due Date

The company must file Form INC-20A within 180 days from the date of incorporation.

Missing this deadline leads to heavy penalties.

Documents Required for INC-20A Filing

To file the Commencement of Business Certificate, you need:

Bank account statement showing receipt of share capital
Certificate of Incorporation (COI)
Proof of registered office address (if not filed earlier)
Board resolution authorising the filing
PAN of the company

Ensure the paid-up capital has been deposited into the company's account before filing.

Step-by-Step Process to File INC-20A

Open a current bank account in the company’s name
Collect proof of capital received from shareholders
Prepare the board resolution
Login to MCA portal and fill Form INC-20A
Upload the required documents
Pay the applicable MCA fees
Submit the form using DSC of the directors

Once processed, the MCA issues the Commencement of Business Certificate.

Penalties for Not Filing INC-20A

Failure to file INC-20A results in:

Penalty on the Company

₹50,000

Penalty on Directors

₹1,000 per day (up to ₹1,00,000)

Possible Strike-Off

The MCA may remove the company’s name from the register for non-compliance.

Common Mistakes to Avoid

Not depositing share capital before filing
Using personal bank accounts instead of company bank account
Incorrect registered office address
Delay in opening the bank account
Filing without proper supporting documents

How IndiaFilings Helps

IndiaFilings offers complete support for INC-20A filing, including:

Bank account assistance
Document preparation and verification
Form filing and DSC support
End-to-end follow-up with MCA
Fast and error-free approval

This ensures your company stays compliant from day one.