INC-20A Filing: Business Commencement Declaration

What Is INC-20A?

If you've just incorporated your Private Limited Company or OPC, congratulations; but you're not yet cleared for takeoff. INC-20A, also known as the Declaration of Commencement of Business, is the RoC filing that formally permits your company to begin business activities and access credit facilities.

In Simple Terms: Think of INC-20A as your company's "engine start" permission slip. Incorporation gives you the company's legal identity (the car), but INC-20A is what lets you actually drive it; sign contracts, raise invoices, or take a business loan.

This requirement has been in effect since a Ministry of Corporate Affairs (MCA) notification dated November 2, 2018, which made the declaration compulsory for all Private Limited Companies and OPCs incorporated after that date.

Founder Scenario: 

Let’s understand with an example:

Priya had just received her Certificate of Incorporation for her D2C skincare brand and was ready to start invoicing clients the same week. Her CA stopped her: "Not yet, we need to file INC-20A first, or none of those invoices hold up legally." Priya learned the hard way that incorporation and "commencement" are two separate milestones and missing the second one can freeze the first.

Who Needs to File INC-20A?

Founders often get confused about who needs to file INC-20A; here is the list of entities that need to file INC-20A just after incorporation of their entities. 

Prerequisites Before Filing INC-20A

Two conditions must be satisfied before you can file:

1. Registered office verified: Filed during incorporation or within 30 days of it.
2. Subscribed capital deposited: The full amount specified in your Memorandum of Association (MoA) must be deposited into the company's bank account, generally within 60 days of incorporation.

Additional checklist:

• A company bank account has been opened in the company's name
• No business transactions have occurred yet, other than capital deposits
• The company hasn't commenced operations before filing

Documents Required for INC-20A

• Subscribers' proof of payment of shares (bank statement)
• Certificate of Incorporation
• Digital Signature Certificate (DSC) of the applicant director
• Director Identification Number (DIN) of the applicant director

In Simple Terms: Your bank statement is doing most of the heavy lifting here; it's the primary evidence that shareholders actually paid up their committed capital, not just promised to.

How to File INC-20A? (Step-by-Step Procedure)

Step 01: Documentation: Gather all supporting documents (see table below) before starting the filing to avoid rejection

Step 02: Form Filing: File INC-20A on the MCA portal, sign digitally using the director's DSC

Step 03: CA/CS/CMA Certification: An independent practicing professional certifies the declaration's authenticity

Step 04: Attach Documents: Upload proof of capital payment and other required documents digitally

Step 05: Submit & Pay Fee: Submit on the MCA portal along with the applicable government fee

Step 06: Acknowledgement Receipt: Save the receipt; it's your proof of compliance for future reference

Approval Process

INC-20A is processed under the Straight Through Process (STP), meaning that once filed with the correct CA/CS/CMA certification and fee payment, it's auto-approved by the RoC without manual scrutiny at the filing stage. This makes accuracy at filing critical, since the certifying professional bears responsibility for the declaration's authenticity.

INC-20A Due Date and Filing Fees

The statutory deadline is 180 days from the date of incorporation. However, filing early is strongly recommended; your company cannot commence operations or access credit until this declaration is on record, so delaying it stalls your business, not just your compliance file.

Government Fee (Based on Subscribed Capital)

Late Filing Penalty

What Happens If You Don't File INC-20A?

Non-filing isn't a paperwork slip; it has real financial and legal teeth:

• Company Penalty: ₹50,000 flat penalty for the defaulting company
• Officer Penalty: ₹1,000 per day of default for every officer in default (directors, CFO, company secretary), capped at ₹1,00,000 per officer
• Strike-off Risk: If INC-20A remains unfiled for over a year, the RoC can strike the company off the register under Section 248 of the Companies Act, 2013

Conclusion 

INC-20A isn't optional paperwork; it's the legal switch that turns your incorporated company into an operational one. File it as soon as your capital is deposited and your registered office is confirmed, rather than waiting until the 180-day deadline creeps up.