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||Public Limited Company||Public Limited Company|
|Public invitations Allow||
|Issuance of Prospectus||
|Mandatory Statutory Meeting||
|Compliances under Companies Act, 2013||
It is preferred form of business among entrepreneurs due to its many advantages as under:
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.
As per Companies Act, 2013, now there is no minimum capital requirement for forming a Public Company .
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.
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 .
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.
In case of Public Limited Company , ownership of Company can be transfer by transferring equity or issuing fresh share, as the case may be.
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.
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.
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.
Minimum three directors required.
Note:Out of all the directors at least one director should be an Indian Resident.
Minimum seven members and maximum No Limit.
Note: Directors and Shareholders can be same or different.
all Proposed Director(s) must have Director Identification Number.
All Members must have digital signature.
Address Proof for the registered office.
Proposed Name of Public limited Company must not be similar or identical to any other Company or LLP.
Object/business to be conducted in proposed public limited company must be Legal.
Minimum capital contribution to be contributed by Members.
Address of registered office of public limited company.
Passport-sized photograph of all directors & Members.
a copy of the PAN of all directors & Members.
a copy of the aadhaar card of all directors & Members.
Any on Proof of Identity like Voter ID/Driving Licencense/Passport of all directors & Members.
Any one Latest Bank Statement / Electricity bill/Telephone or Mobile Bill (Not older than two months) of all directors & Members.
(In case of NRI or foreign national as a Director): Passport should be notarized or apostilled as applicable by the relevant authorities
Valid mobile number of all directors/Members.
Valid Email-id of all directors/Members.
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.
Apply for Digital Signature Certificate (DSC) of all proposed seven members.
Finalisation of Name of Company and drafting of Memorandum of Association (MOA) and Article of Association (AOA) of Company respectively.
Obtain signed declarations from a proposed directors and Members.
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.
After getting approval of Public Company, Certificate of Incorporation will be issued.
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.
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.
At least one Board Meeting must be held in every quarter of year and gap between two meetings should not exceed 120 days .
Every Pubic Limited Company must maintain its Minutes of each meeting held and statutory registers.
Annual Return is required to be filed with the Registrar of companies in Form-MGT-7 .
every Public Limited Company is required to submit their income tax return by 30th September every year.
Audit financials is required to be filed with the Registrar of companies in Form-AOC-4 .
Every changes in company shall be required to be complied with procedure laid down in Companies Act.