A Non-Profit company is regulated by section 8 of the Indian Companies Act 2013 and administered by the Ministry of Corporate Affairs - MCA. It is usually formed for promoting science, art, commerce, charity, religion or any other purpose that is useful to society. Section 8 company has limited liability and cannot make any profits also there is no minimum paid-up capital required for the purpose of a company incorporated under section 8.
Purpose of Non-Profit companies
The main purpose of establishing a company under section 8 is to promote non-profit objectives such as trade, commerce, arts, charity, education, religion, environment protection, etc. The profits/incomes of the company if any, are applied towards promoting the objectives of the company and are not distributed as dividends to its shareholders also there is no minimum paid-up capital required for the purposes of a company incorporated under section 8.
Minimum requirements for Non-Profit Company
There must be at least two shareholders.
There must be at least two directors (directors and shareholders can be the same person);
At least one of the director should be an Indian Resident.