# Commencement of Business (Section 10A)
A company having share capital cannot commence business or exercise borrowing powers immediately after incorporation. It must first comply with Section 10A.
## What Must Be Filed?
A declaration in the prescribed form by a director, filed with the ROC, stating that:
> Every subscriber to the Memorandum has paid the value of the shares agreed to be taken by him.
## Time Limit
- Declaration must be filed within 180 days of incorporation.
- Only after this filing can the company:
- Commence its business, OR
- Exercise its borrowing powers.
## Consequence of Default
If the company fails to file the declaration within 180 days AND is found to be not carrying on any business or operation, the ROC may take action for the removal of the company's name from the Register of Companies (i.e., striking off).
## Flow Chart
```
Incorporation (Day 0)
|
v
Subscribers pay subscription money
|
v
Director files declaration with ROC (within 180 days)
|
v
Company may commence business / borrow
```
## Why this Section Exists
The section ensures the company has actually received its initial capital before it starts trading or incurring debt — protecting creditors and the public.
## Quick Recall
- Applies to: Companies having share capital
- Time limit: 180 days
- Form: INC-20A (in practice)
- Default consequence: Possible strike-off by ROC