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When it comes to start a company in India, Private Limited Company emerges out as the most popular way forward for investors and entrepreneurs. And it is not just a fad, there are many reasons what make this version of business format quite popular.
A private limited company is a type of company that features several advantages such as limited liability, easy incorporation, high degree of flexibility, separate legal existence and others. The management of any such company is a bit less complex as compared to other versions of the businesses.
This type of company can be formed by 2 or more members willing to start their own business venture. A Private Limited Company is entitled for registration of its securities in BSE and NSE. In this case, the shares are held by either by the owner or a group of closely related people. Due to its easy incorporation feature, it remains a preferred choice of investors.
In addition, due to limited number of shareholders, it faces less stringent legal compliances as compared to other version of businesses. For those looking to expand their business globally, Private Limited Company is a feasible option which allows 100% Foreign Direct Investment without the need of prior approval from the government. It takes around 3-4 days to form this type of company.
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In regard to the Private Limited Company registration, following documents are needed:
Giving by its name, it is basically a digital signature of a person and is needed for filing the e-forms of company setup electronically to Ministry of Corporate Affairs. Digital Signature Certificates or DSC or Digital Signature are being accepted by various government agencies and now is a statutory requirement in different applications. It is a useful way of electronically signing documents.
An individual with a minimum of 18 years of age can become a director of a Private Limited Company. It is necessary for him to have Indian citizenship which means that even a foreign national can become a director.
No, the promoters need not to be present at the time of company incorporation.
The limit in this kind of company incorporation is minimum two members and maximum two hundred.
There is no minimum limit on the capital requirement.
It takes around 5 to 8 days to setup a Private Limited Company. The time to be consumed generally depends on the submission of necessary documents to respective authority and obtaining government approvals. It is suggested to pick a unique company name and furnish all required documents for speedy processing of application.
Yes, with respect to Foreign Direct Investment (FDI) Guidelines a NRIs / Foreign Nationals / Foreign Companies can hold shares of a Private Limited Company.
DIN is a unique Identification Number allotted to an individual who is appointed as a director of a company, upon making an application in form DIR-3 pursuant to section 153 & 154 of the Companies Act, 2013. It remains in force for the whole life of the person. Any person intending to become a director in an existing company shall file form DIR-3 and the same gets processed by Central Government (Office of Regional Director (Northern Region), Ministry of Corporate Affairs).
Primarily the name must be unique and simple, short and memorable. It is advisable to check on Google, MCA Portal, MCA Guidelines and Trade Mark site the availability of Name.
'Memorandum of Association' abbreviated as MOA, is the basic document of the company, which contains all the general details about the company. On the other hand, 'Articles of Association' shortly known as AOA, is a document containing all the rules and regulations designed by the company. It outlines the ways in which shares are distributed, rules to be followed by the stakeholders, responsibilities of the individuals to the company etc. AOA is more flexible than MOA and acts as its preamble. The users may obtain approved e-MOA (INC-33) and e- AOA (INC-34) through certified copies facility available on MCA.
Certificate of Incorporation (COI) is a legal document that is issued by Ministry of Corporate Affairs (MCA) once a company is successfully registered with them. The promoters can expected to receive the certificate within 6 to 10 days along with the TAN and PAN after uploading the Spice e-form INC-32, Spice MOA (INC-33), and Spice AOA (INC-34).
Private Limited Companies are required to file its Annual Accounts and Returns disclosing details of its shareholders, directors etc. to the Registrar of Companies. Such compliances are required to be made once in a year.
As a part of Annual Filing, the following forms are to be filed with the ROC: Form MGT-7 (Annual Return) : Every Private Limited Company is required to file its Annual Return within 60 days of holding of Annual General Meeting. Annual Return will be for the period 1st April to 31st March. Form AOC-4 (Financial Statements): Every Private Limited Company is need to file its Balance Sheet along with statement of Profit and Loss Account and Director Report in this form within 30 days of holding of Annual General Meeting.
A director is precisely an agent of the company, appointed by the shareholders to manage its day-to-day affairs. The basic rule is that the directors must act together as a board but generally the board may also delegate certain powers to individual directors or to a committee of the board. A director's duties can include: determining and implementing policies and making decisions.
Minimum no. of directors is two and maximum are fifteen.
A Private Limited Company can choose to attain, own, enjoy and isolate property in its own name. No shareholders are eligible to make any claim upon the property of the company as long as the company is a running entity.
In this article we will be discussing some of the benefits of business registration in India.
The company registration process in India is an intricate one. It involves the role of company secretaries, Chartered ac ....
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