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    Treatment of assets of Section 8 company on dissolution

    Posted By : Sohil / Published on : 25-Apr-2023 04:14 AM / View : 273 / Comment : 1

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    Dear All,

    How to treat assets of Section 8 company that remains after winding up or dissolution after satisfaction of its debts and liabilities?
    Read more on : dissolution company section assets treatment

    • Yes, if we talk about the Section 8 companies, also known as non-profit organizations, are governed by the Companies Act, 2013 in India. According to Section 8 of the Companies Act, a Section 8 company may be wound up or dissolved voluntarily or by an order of the court.

      If a Section 8 company is wound up or dissolved, any assets remaining after the satisfaction of its debts and liabilities shall be transferred to another Section 8 company with similar objects. If there is no such company available, the assets may be transferred to any other non-profit organization, registered under Section 12AA of the Income Tax Act, 1961, or to the government for charitable purposes.

      The transfer of assets should be made in accordance with the provisions of the Companies Act, 2013, and any other applicable laws or regulations. The transfer of assets should be made with the approval of the court, if required, and in accordance with any restrictions or conditions imposed by the company's memorandum and articles of association.

      It is important to note that the assets of a Section 8 company cannot be distributed among the members or shareholders, as the company does not have any shareholders. The assets must be utilized for charitable purposes, as per the objectives of the Section 8 company.

      25-04-2023 / 06:32:20 AM
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