Define certificate of commesment

There are certain rules and regulations you need to follow while establishing anything and everything. These rules and regulations help you form a strong base for your work. These rules are especially mandatory when dealing with any legal venture. Similarly, when you set up your business, you need to follow certain rules and regulations, prescribed by the Government. It gives your entity a legal identity as well as provides you with other benefits. Obtaining Certificate of Commencement of Business is one of the steps you need to follow between registering and running your business. It was a mandatory step until Companies Act, 2015 was introduced. The Act has now removed the previous compulsion of having this certificate. Now, it depends on you whether to obtain one or not. Howsoever, discussed below is what is a certificate of commencement of business.

The certificate of commencement of business was a mandatory step under Companies Act, 2013. It was mandatory for public companies with share capital. The certificate is issued by the registrar of joint stock companies.

The certificate of commencement of business was important because only after obtaining the certificate were you allowed to start any business related activities. Before that, you were not allowed to exercise any kind of powers or benefits which come along with company registration.