WHAT IS COMPANY
Company is a legal entity made up of an association of people, be they natural, legal or mixture of both, for carrying on a commercial or industrial enterprise. In general terms , Company , a group of people together joined a hand to do business. Company is a prominent option to start a business in india by startups and other businesses.
Every company incorporated under Companies Act of 2013 and governed by Ministry of Corporate Affairs (MCA). It is a registered corporate structure and having a separate legal entity from owner. Due to its feature of being separate legal entity and governed by MCA, its popular form to start business.
POPULAR TYPES OF COMPANIES INCORPORATED IN INDIA
PRIVATE LIMITED COMPANY REGISTRATION IN INDIA
A private limited company is the most prominent form of business entity in India in comparison to others. Due to its advantages as per Companies Act, 2013 and as start-ups, forming a company is increasing day by day in india.
Ownership of the company is defined by share capital. Also it is a separate legal entity from its owner which clearly differentiates Company from its ownership. Owners of shares will have liability only upto their shareholders. Its regulatory authority is MCA, Hence it is preferred by VCs, angel investors and banks for providing debt or equity funding.
However, one should also consider higher compliance and mandatory audit requirement, making it an expensive structure to maintain. As a result, startups and growing businesses register a private limited company . It provides their business with a separate corporate entity, eases to raise funds, and an ability to transfer equity to potential investors.
It is preferred form of business among entrepreneurs due to its many advantages as under:
Limited Liability :
Liability of Members/shareholders of Private Company will be limited to their holding only in the company no to their personal assets. Its means in case of any loss or liability would be pay off from the investments or assets of the company only and the personal assets of the Members/shareholders would be remain protected.
No minimum capital requirements:
As per Companies Act, 2013, now there is no minimum capital requirement for forming a Private Company.
Separate legal Entity:
A Private Limited Company is separate legal entity distinct from its Members. It’s a artificial person and company’s documents will be issued in the name of Company only. Company’s directors will act on behalf of the Company not as the Company.
Regulatory Authority:
Private Limited Company is regulated by Ministry of Corporates Affairs (MCA) . Due to its regulatory authority and strict structure , Private Limited Companies can easily raise funds from Banks or Financial institution .
Perpetual Succession:
Private limited companies are considered as separate legal entities and are separate from the existence of their owners which means they cannot be dissolved or end because of the death, retirement or insanity of any of their member/ director/ shareholder.
Easily transfer of ownership:
In case of Private Limited Company , ownership of Company can be transfer by transferring equity or issuing fresh share, as the case may be.
Credibility in market:
A registered Company is considered to be more trustworthy in market in caparison of other unregistered entity due to its data available at MCA website , Regulated by Act, supervised by MCA, requirement to get Accounts audited and financials available for public inspection.
WHAT ARE PRE-REQUISITES TO GET PRIVATE LIMITED COMPANY REGISTER
Minimum two directors:
Minimum two directors and maximum upto fifteen directors required.
Note: Out of all the directors at least one director should be an Indian Resident.
Minimum two Members/shareholder and Maximum 200:
Minimum two members and maximum upto 200 members required.
Note:Directors and Shareholders/Members can be same or different.
DIN:
Proposed Director(s) must have Director Identification Number.
Digital Signature:
All Members must have digital signatureAll Members must have digital signature.
Registered Office:
Address Proof for the registered office.
WHAT ARE THE NECESSARY INFORMATION & DOCUMENTS TO GET PRIVATE LIMITED COMPANY REGISTER?
Information
Proposed Name:
Proposed Name of Private limited Company must not be similar or identical to any other Company or LLP.Object of LLP:
Object/business to be conducted in proposed private limited company must be Legal.
Capital:
Minimum capital contribution to be contributed by Members.
Registered office address:
Address of registered office of private limited company.
Documents
Photograph:
Passport-sized photograph of all directors & Members.
PAN Card:
a copy of the PAN of all directors & Members.
Aadhaar Card:
a copy of the aadhaar card of all directors & Members.
Identity Proof:
Any on Proof of Identity like Voter ID/Driving Licencense/Passport of all directors & Members.
Address proof:
Any one Latest Bank Statement / Electricity bill/Telephone or Mobile Bill (Not older than two months) of all directors & Members.
Passport:
(In case of NRI or foreign national as a Director): Passport should be notarized or apostilled as applicable by the relevant authoritie.
Mobile Number:
Valid mobile number of all directors/Members.
E-mail id:
Valid Email-id of all directors/Members.
Registered office proof:
For registered office (i) address proof, electricity bill or any utility bill (not older than 2 months) (ii) duly signed NOC from Owner and (iii) If Rented, Duly notarized rent agreement along with one month receipt.
HOW TO GET REGISTER PRIVATE LIMITED COMPANY
STEP 1 :
Apply for Digital Signature Certificate (DSC) of all proposed members.
STEP 2:
Finalisation of Name of Company and drafting of Memorandum of Association (MOA) and Article of Association (AOA) of Company respectively.
STEP 3:
Obtain signed declarations from a proposed directors and Members.
STEP 4:
After finalisation of Name of Private Limited Company drafting of MOA & AOA , Preparation and filing of Form Spice+ for Name Approval , DIN application, Incorporation of Private Company, Issue of PAN & TAN and Opening of Account.
STEP 5:
After getting approval of Private Comapny, Certificate of Incorporation will be issued.
POST INCORPORATION ONE TIME COMPLIANCES
Once the incorporation certificate is obtained and opening of Bank Account, the Members must deposit the amount mentioned in the MOA of the Company.
Once, the equity capital is infused into the Bank's current account; the Company can file for the commencement of business with the MCA. Commence of Business certificate must be obtained within 180 days of incorporation in Form INC-20A to avoid a penalty.
In case notice of the situation related to registered office was not filed during incorporation, it must be filed within 30 days after incorporation in Form –INC 22.
ANNUAL COMPLIANCES REQUIREMENTS AFTER THE COMPANY REGISTRATION
Every Private Limited Company is required to comply with the annual compliance requirements. These compliances are mandatory for all Private Limited Company whether they have started their business or not.
Board meetings in each half calendar year or one in every quarter, as the case may be
At least one Board Meeting in each half of the calendar year and the time gap between the two Board Meetings should not be less than 90 days OR one in every quarter and gap between two meetings should not exceed 120 days .
Maintenance of Minutes and Statutory Registers
Every Private Limited Company must maintain its Minutes of each meeting held and statutory registers.
Yearly Annual Return
Annual Return is required to be filed with the Registrar of companies in Form-MGT-7 .
Income Tax Return
every Private Limited Company is required to submit their income tax return by 30th September every year.
Filing of Audit Financials
Audit financials is required to be filed with the Registrar of companies in Form-AOC-4 .
Event based Compliances
Every changes in company shall be required to be complied with procedure laid down in Companies Act.
