BASIC CONCEPT OF PUBLIC LIMITED COMPANY

Just Like Private Limited Company, a Public limited company is the most prominent form of business entity in India in comparison to others. 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.
It can be incorporated with a minimum number of three directors and has more stringent rules and regulations as compared to a Pvt. Ltd. Company.

DIFFERENCE BETWEEN PRIVATE LIMITED COMPANY AND PUBLIC LIMITED COMPANY

WHY PUBLIC LIMITED COMPANY

It is preferred form of business among entrepreneurs due to its many advantages as under:

Limited Liability :

Liability of Members/shareholders of Public 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 Public Company .

Separate legal Entity:

A Public 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:

Public Limited Company is regulated by Ministry of Corporates Affairs (MCA) . Due to its regulatory authority and strict structure , Public Limited Companies can easily raise funds from Banks or Financial institution .

Perpetual Succession:

Public 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 Public 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.

Public funding :

In a Public Limited Company , a general public can be invited for infusing capital to buy shares of the company by following procedure as laid by Companies Act, 2013.

Extension of borrowing capacity:

In case of Public Company, borrowings scope became wide in comparison of Private Company in order to expand and grow business by investing in new projects.

WHAT ARE PRE-REQUISITES TO GET PUBLIC LIMITED COMPANY REGISTER

Minimum three directors:

Minimum three directors required.

Note:Out of all the directors at least one director should be an Indian Resident.

Minimum seven members/shareholder and Maximum no limit :

Minimum seven members and maximum No Limit.

Note: Directors and Shareholders can be same or different.

DIN:

all Proposed Director(s) must have Director Identification Number.

Digital Signature:

All Members must have digital signature.

Registered Office:

Address Proof for the registered office.

WHAT ARE THE NECESSARY INFORMATION & DOCUMENTS TO GET OPC REGISTER

Information

Proposed Name:

Proposed Name of Public limited Company must not be similar or identical to any other Company or LLP.

Object of LLP:

Object/business to be conducted in proposed public limited company must be Legal.

Capital:

Minimum capital contribution to be contributed by Members.

Registered office address:

Address of registered office of public 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 authorities

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 PUBLIC LIMITED COMPANY

STEP 1 :

Apply for Digital Signature Certificate (DSC) of all proposed seven 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 Public Limited Company drafting of MOA & AOA , Preparation and filing of Form Spice+ for Name Approval , DIN application, Incorporation of Public Company, Issue of PAN & TAN and Opening of Account.

STEP 5:

After getting approval of Public Company, Certificate of Incorporation will be issued.

POST INCORPORATION ONE TIME COMPLIANCES

Commencement of Business :

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.

Intimation of Registered Office address:

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 Public Limited Company is required to comply with the annual compliance requirements. These compliances are mandatory for all Public Limited Company whether they have started their business or not.

Board meetings in every quarter of year

At least one Board Meeting must be held in every quarter of year and gap between two meetings should not exceed 120 days .

Maintenance of Minutes and Statutory Registers

Every Pubic 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 Public 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.