Private Company Registration In India

As per section 2(68) of the companies Act 2013, private company” means a company having a minimum paid-up share capital as may be prescribed, and which by its articles, —

(i) restricts the right to transfer its shares;

(ii) except in case of One Person Company, limits the number of its members to two hundred:

Provided that where two or more persons hold one or more shares in a company jointly, they shall, for the purposes of this clause, be treated as a single member:

Provided further that—

(A) persons who are in the employment of the company; and

(B) persons who, having been formerly in the employment of the company, were members of the company while in that employment and have continued to be members after the employment ceased, shall not be included in the number of members; and

(iii) prohibits any invitation to the public to subscribe for any securities of the company

One of the most prevalent and popular type of corporate legal entity in India is Private Limited Company. Our Ministry of Corporate Affairs, governs registration of private limited company under Companies Act, 2013 and the Companies Incorporation Rules, 2014.

Minimum requirement of registering Private Company is at least of two stakeholders and two directors. foreign nationals, foreign corporate entities or NRIs are allowed to be Directors    and/or Shareholders of a Company with Foreign Direct Investment, making it the preferred choice of entity for foreign promoters.

Private limited company have ability to raise equity funds, separate legal entity status and perpetual existence make it the most recommended type of business entity for millions of small and medium sized businesses that are family owned or professionally managed.

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    Registering a private company in India involves several steps and compliance requirements. Here is a general overview of the process:

    1. Obtain Digital Signature Certificate (DSC):

    The first step is to obtain a Digital Signature Certificate for the proposed directors of the company. This is necessary for filing documents electronically.

    2. Director Identification Number (DIN):

    All directors of the company need to obtain a Director Identification Number (DIN). This can be obtained by filing an online application with the Ministry of Corporate Affairs (MCA).

    3. Name Approval:

    Choose a unique name for the company and check its availability. You can apply for name approval through the MCA website.

    4.Memorandum and Articles of Association:

    Draft the Memorandum of Association (MOA) and Articles of Association (AOA) of the company. These documents define the company’s objectives and rules of operation.

    5. Filing Forms with the Registrar of Companies (ROC):

    File the required incorporation forms (e.g., SPICe Form) along with the MOA and AOA, and other necessary documents with the ROC. This can be done online.

    6. Payment of Fees:

    Pay the required fees for filing the incorporation documents. The fee depends on the authorized capital of the company.

    7. Certificate of Incorporation:

    Once the ROC verifies the documents and is satisfied, they will issue a Certificate of Incorporation. This certificate serves as proof of the existence of the company.

    8. PAN and TAN Application:

    Apply for the company’s Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) with the Income Tax Department.

    9. Bank Account:

    Open a bank account in the name of the company. The bank will require the Certificate of Incorporation, MOA, AOA, and other relevant documents.

    9. GST Registration:

    If your company’s turnover is expected to exceed the prescribed limit, you may need to register for Goods and Services Tax (GST).

    9. Compliance Requirements:

    Ensure compliance with ongoing regulatory requirements, such as filing annual returns, conducting annual general meetings, and maintaining statutory records.

    9. Professional Assistance:

    It is advisable to seek professional assistance from a chartered accountant or company secretary to ensure compliance with all legal requirements.

    Note:

    The process may evolve, and it’s crucial to check for the latest regulations and requirements on the Ministry of Corporate Affairs (MCA) website or consult with a webetax professional.

    Additional Tips:

    Stay updated on changes in company law and compliance requirements. Engage with webetax professional as we are specializing in company registration for accurate guidance.

    Keep in mind that the above steps provide a general overview, and the specific requirements may vary based on the nature of your business and any updates in regulations. It’s recommended to consult with webetax professionals or legal experts for personalized guidance.

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