Company Registration (Pvt. Ltd.)

07/Mar/2019 08:47:29pm

Private Limited Company is for the most part Start-ups and developing organizations inclined towards it on grounds that it permits External financing from angel investors and VC Firm or other speculators. The question is why? One of the most important features is constraining the liabilities of its shareholders so its shield the proprietors and financial investors from individual liability.The next Great Advantage is to offer employee stock options (representative investment opportunities) to pull in the best available resource with talent. Before moving forward with the process of registration, let us look at the unique features of Private Companies – • Unique Legal Entity: A Pvt. Ltd. Co. is a legal person and a juristic individual built up under the Companies Act 2013. • Restricted Liability: Member’s own assets are sheltered so its a primary preferred standpoint for a private limited company and risk of individuals is constrained to the advantages of an organization so they are not paying from individual resources (personal assets). • Perpetual Existence: An organization has interminable existence, which mean they have no impact if a partner changes or passes away or some other circumstance. • Obtaining Capacity: Banks, Angel Investors, VC Firms and numerous other wellspring of funds dependably incline toward private limited companies rather than proprietorship firm or partnership firm. • Investment Ready: Generally, numerous thoughts require starting financing so private limited organization is the best alternative on seed funding case. • Tax Deduction: Sole merchants and partnerships pay income tax. Private Limited Company needs to pay corporate tax so there is parcel of commitment in contrast to partnership firm or proprietorship firm. Minimum Requirements for form a private limited company • Minimum 2 Directors – As per Section 149 (3) of the Companies Act, 2013, every company shall have at least one director on its board of directors, who has stayed in India for a total period of not less than one hundred eighty two (182) days in the previous calendar year. • Minimum 2 Shareholders or Person – The directors and the shareholders can be the same person. • Minimum 2 Directors ( Directors and Shareholder can be same) • Minimum Share Capital shall be INR 100,000 (Rs. 1 lac) • Application of allotment Director Identification Number (DIN) for all the directors. • DSC (Director Signature Certificate) for two Directors. In India, there are around 7 lakhs enrolled organizations and consistently a large number of firms apply for enlistment every month. A Company is a legal substance. As indicated by Companies Act, an organization implies a lawful entity shaped and enrolled under Companies Act. There are some official strategies a startup or an organization needs to follow so as to enroll them in Indian authority records. This influenced the MCA (Ministry of Corporate Affairs) to make the enrollment process online. The complete procedure for registration is divided into 8 steps. Step 1: – Application for DIN in form DIR-3 and DSC DIN is a unique number issued by the Ministry of Corporate Affairs (MCA), for an existing director or a person intending to become director of a company. Documents required for DIR-3 application For Indian National • Identity Proof • Address Proof • Passport Sized Photograph (latest) • Current Occupation • Email Address of Applicant • Mobile/Cell Number • Educational Qualification • Verification to be signed by Applicant In case of Foreign National • Identity Proof • Address Proof • Passport Sized Photograph (latest) • Current Occupation • Email Address of Applicant • Mobile/Cell Number • Educational Qualification • Verification to be signed by Applicant Important Notes 1. All documents require ‘Self Attestation’ 2. In case the director is dwelling outside India, the joined supporting reports ought to be validated by the Consulate of the Indian Embassy, Foreign Public Notary. If the instance of directors, supporting records can be validated by Company secretary in full time business/CEO/Managing Director of the Indian Company in which he/she proposed to end up noticeably as a director. 3. DIR-3 should be digitally marked by the same individual, i.e. the one who is documenting the application and by both of the accompanying: 4. a) Company Secretary (in full time business) or Chartered Accountant (in full time practice) or Cost Accountant (in full time business) 5. b) Company Secretary in full time business or Director of the organization in which the individual is to be selected as a director. 6. While making DIR-3 Application following subtle elements are obligatory: 7. First Name, Middle Name, Last Name, Details of father of an individual (even if there should be an occurrence of a wedded lady) 8. In instance of a Married lady, a photocopy of the Marriage Certificate is required (If DIN should be in the “Changed Name”) 9. There could be occasions of DIR3/DIN Rejection. What is a Digital Signature Certificate (DSC)? Digital Signature Certificate (DSC) is the digital equivalent (i.e. electronic format) of physical or paper certificates. Examples of physical certificates are driver’s license, passport. Certificates serve as proof of identity of an individual for a certain purpose; for example, a driver’s license identifies someone who can legally drive in a particular country. Additionally, a digital declaration can be exhibited electronically to demonstrate one’s identity, to get to data or administrations on the Internet or to sign certain reports digitally. Since MCA acknowledges electronic accommodation of Forms on its site the DSC is obligatory for every one of the clients. Documents required for obtaining DSC 1. Digital Signature Certificate application Form (duly signed by an applicant). An applicant is required to sign across the photo. 2. Download the DSC Application Form (Class II Individual Certificate) 3. All other documents are same as required for the DIR-3 Application 4. Note: All the documents require “Self-attestation” and identity proof and address proof should be attested by either a Gazetted officer (Class I) or Bank manager or Post Master. Step 2 :- Search for the Company Name availability The Promoters need to give no less than 6 names in the request of their preference/need. The Promoters would themselves be able to search for the accessible names by going to the MCA Website: Check Name Availability. It is also advised to check any pre-existing Trademarks already registered with the Company name being suggested, since Registrar of Companies generally scrutinizes the same & may reject the Proposed names on that basis (if similar TM Name is already registered). Promoters should search for any existing Trademark using http://ipindia.nic.in/ website Check Trademark. Step 3 :- Application for the Name availability In the wake of drafting of Main Object of the proposed organization, one needs to file e-Form INC-1 (Application for reservation of name) with Registrar of Companies for name accessibility. The Applicant needs to give 6 proposed names in priority alongside their importance and significance of each word. It is to be noted that the “undesirable names” rules extracts from the Companies (Incorporation) Rules, 2014 be referred before selecting names. Also reference must be made to MCA General Circular on Use of word ‘National’, ‘Bank’, ‘Exchange’, ‘Stock Exchange’ in the names of Companies or Limited Liability Partnerships (LLPs). (General Circular No. 2/2014) Step 4 :- Drafting of Memorandum of Association (MOA) & Articles of Association (AOA) Memorandum of Association (MOA) covers essential and fundamental provisions of the organization’s constitution. It covers the main object, essence and various objects of the company. Articles of Association (AOA) contain rules and regulations governing and overseeing the inward administration of the organization. It is a coupling contract amongst the company and its members defining their rights and obligations. According to Section 4(5) (i) of the Companies Act 2013, on receiving of an application under sub-segment (4), the Registrar may, on the premise of data and records outfitted alongside the application, hold the name for a time of sixty days from the date of the application. After name has been approved from ROC, the next step is to draft MOA & AOA. The endorsers need to indicate their Name, Address, and Occupation in claim penmanship and sign the membership pages of MOA and AOA. In the event of a subscriber being a Foreign National (residing outside India), one must refer to Chapter 2 of Companies (Incorporation) Rules, 2014 notified by Ministry of Corporate Affairs for knowing the procedure of obtaining attestation and notary while signing subscription pages of Memorandum and Articles of Association and other relevant document. Step 5 :-Filing of e-forms with RoC (Registrar of Companies) The following forms need to be filed/uploaded on the MCA Website – 1. Form INC-7: For application of Incorporation of the Company 2. Mandatory attachments to e-form INC-7 3. Memorandum of Association. 4. Articles of Association. 5. Declaration by Professional in INC-8. 6. Affidavit from the subscriber to the Memorandum in Form No.INC-9. 7. Proof of residential address which should not be older than two months. 8. Proof of identity. 9. Validation of signature of the subscribers i.e. Form INC-10, in case the organization is lacks share capital. 10. It is mandatory to attach entrenched Articles of association if any of the articles are entrenched. 11. Optional attachments depending upon case 12. Copy of in principle approval granted by the Reserve Bank of India or any concerned authority in case proposed company shall be conducting NBFI (Non-Banking Financial Institution) activities. 13. NOC in case of change in the promoters 14. Proof of nationality in case the subscriber is a foreign national. 15. PAN card (in case of Indian national) 16. Copy of certificate of incorporation of the foreign body corporate and proof of registered office address. 17. Certified true copy of board resolution/consent by all the partners authorizing to subscribe to MOA. 18. Form INC-22: For Notice of situation of registered office Attachments to e-form INC-22 1. Proof of Registered Office address (Conveyance/Lease deed/Rent Agreement along with the rent receipts) etc. 2. Copies of the utility bills (proof of evidence of any utility service like telephone, gas , electricity etc. depicting the address of the premises not older than two months is required to be attached). 3. No Objection Certificate or permission to use. 4. Certification of e-form INC-22 by CS/CA/CWA (in Whole Time Practice) 5. Form DIR-12: For providing information about particulars of appointment of Directors of the company and Key Managerial Personnel Attachments to e-form DIR-12 – Following are the Mandatory attachments in case of an appointment of a Director / Manager / Company Secretary / CEO / CFO. 1. Letter of appointment 2. Announcements by first director in Form INC-9 3. Announcement of the appointee director and MD in Form DIR-2 Step 6 :-Payment of RoC Fees & Stamp Duty In the wake of filing of documents on the web, we have to make installment of RoC expenses and Stamp Duty electronically which depends on the Authorized Capital of the Company. The MCA Fee Calculator might allude or the connected “Charge Schedule”. Step 7 – Verification of documents/forms by RoC After paying the installment of all RoC Fees and Stamp obligations, RoC confirms/investigates every one of the reports and forms and may propose few changes to be made in the connections or forms itself. We have to roll out vital improvements in like manner. Step 8 – Issue of Certificate of Incorporation by RoC When each one of the Forms are properly endorsed by RoC, the carefully marked “Testament of Incorporation” is messaged to the Directors. As part of the Green Initiative by the MCA (Ministry of Corporate Affairs), few Certificates including “Authentication of Incorporation” are currently issued just in the electronic format i.e. soft-copy (having computerized mark of RoC Registrar). Once the Incorporation Certificate is gotten, Company can begin its operations.