Private Limited Company Registration in India
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Introduction
A Private Limited Company in India is a highly popular business structure for establishing a corporate entity. This type of business incorporation combines the perks of a partnership with the advantages of limited liability towards its shareholders, making it an attractive option for entrepreneurs.
Eligibility and Requirements
To register a Private Limited Company in India, there are a few basic requirements:
01
There must be a minimum of two directors and a maximum of 15. At least one of the directors must be a resident of India.
02
The company should have a minimum of two shareholders (individuals or corporate entities), with a maximum of 200 shareholders.
03
There is no minimum capital requirement, but the share capital must be adequate for the company’s business needs.
04
The company must have a registered office in India.
Steps for Registration:
Digital Signature Certificate (DSC)
Directors of the company need to obtain a DSC, which is used to file the registration documents electronically.
Director Identification Number (DIN)
Each director needs to acquire a DIN, which can be applied for at the time of company registration.
Name Approval
A unique company name must be proposed and approved on the MCA (Ministry of Corporate Affairs) portal. The name can be reserved through the RUN (Reserve Unique Name) service.
Incorporation Application
Submission of the SPICe+ form (Simplified Proforma for Incorporating Company electronically Plus), which integrates multiple services.
Memorandum of Association (MoA) and Articles of Association (AoA)
These documents are crucial as they detail the constitution of the company and the rules governing the management of its internal affairs.
PAN and TAN Application
Application for PAN (Permanent Account Number) and TAN (Tax Deduction and Collection Account Number) are also filed through the SPICe+ form.
Advantages of a Private Limited Company
01
Limited Liability: Shareholders' liability is limited to their shareholdings, protecting personal assets in the event of business failure.
02
Perpetual Succession: The company continues to exist even if one or more shareholders or directors change.
03
Separate Legal Entity: The company is considered a separate legal entity, which can own property and incur debts.
04
Credibility: Having 'Pvt Ltd' as part of the business name enhances credibility among vendors, customers, and lenders
Post-Registration Requirements
After the company is registered, it must comply with various statutory requirements such as filing annual returns, conducting annual general meetings (AGM), and maintaining books of accounts.
The cost of registering a Private Limited Company can vary depending on the share capital, professional fees, and other miscellaneous expenses. Typically, the process can be completed within a few weeks, assuming all documents are prepared and submitted without error.