A Section 8 company is company which intends to apply its profit or income to its object i.e non profit organisation. Section 8 company refers to a Company which has the object of promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other objects; A Non profit making company (Section 8) is prohibited from paying any Dividend to its members.
A Section 8 company shall register itself under charitable objects, the Central Government shall issue a License in prescribed manner allowing the association of person to register as Private Limited or Public Limited Company. The company registered under section 8 must not alter its Memorandum or Articles without approval of central government. It has the option of converting itself into company of any other type.