According to the Companies Act 2013, Private Limited Company has an authorized capital of 1 Lakh rupees or more with a maximum of 200 members. They cannot invite or accept deposits from anyone despite its members. It is one of the popular types of companies registered in India and is governed under the Ministry of Corporate Affairs.
Requisites to register a Pvt. Ltd. Company
Most of the entrepreneurs prefer to register their business as a Pvt. Ltd. Company. However; to initiate the registration process, it is necessary to have –
- A scanned copy of PAN Card of all the directors along with Voter ID/ Passport or Driving License.
- Address proof which must not be older than 2
- No Objection Certificate from the owner of the office with a utility bill.
- In case of rented office, a notarized rent agreement will be submitted while Registry Proof will be required in case of owned property.
Registration Process for Pvt. Ltd. Company in India
There is a new system of registering a company after the process has become online. All the forms can be filed in one place without any hassle. Here is the complete procedure –
- Getting a Digital Signature Certificate
A digital signature is required for all the directors and shareholders to initiate the registration process. It is a USB Drive which contains the encrypted signature of a particular person to sign a document on a computer or laptop.
- Director’s Identification Number
DIN is a distinct 8 digit number which is required for any existing or proposed director of the company. Having a DIN for all the directors is mandatory. For obtaining a DIN following documents are required–
- PAN Card
- Aadhar Card
- Bank Statement
- Electricity Bill
- Phone Bill
- Reserving a name
Before registering a Pvt. Ltd. Company, the proposed name is reserved by filing INC–1 form along with the prescribed fee. You can file 6 names in an application in the order of your preference.
It is always better to search the availability of the names so that the proposed name does not reject by the Registrar. These points will help you to decide a distinct company name –
- There should be no name similar to an already existing company or name.
- It should not be similar to any registered Intellectual Property.
- When winding-up a company, the name of the respective company will not be available for registration for 2 However, if it is done with the order of the court, the duration will increase to 20 years.
- Drafting of MOA and AOA
MOA – Memorandum of Association is a legal document which defines the objectives of the company and acts as its constitution.
AOA – Articles of Association includes the rules and regulations which are related to the internal management of the company.
- Filing the incorporation form
An application for incorporation is filed through the SPICe form. The Company Registrar will view the application, and if found satisfactory, he/she will issue a certificate of incorporation.
It will include a legal seal, signature of the registrar, date of incorporation and a PAN number of the company. The certificate will allow the directors of the company to use the name officially.
Advantages of a Pvt. Ltd. Company
There are various merits of opting for a Pvt. Ltd. Company. It is one of the most popular amongst entrepreneurs.
- It has a distinct legal entity and existence established by the Law.
- The members and promoters are autonomous from the company and are not bound by any Act.
- The members and the shareholders are liable for their share in the company only.
- Forming a company leads to tax deductions and allowances which can be redeemed against profits earned.
- A Pvt. Ltd. The company can be converted into any other form of a company like Public Limited Company, Nidhi Company, etc.
Let’s Sum Up
The registration process takes about 10-20 working days to complete. However, if there is any problem with the documents or filing the process might delay.
Once the registration is completed successfully, the directors are free to use the name of the company to market their products or services.