There are various kinds of businesses that can be incorporated as per law and private limited companies are among them. Being one of India’s most popular types of entities, a Private Limited Company has private ownership and whose shares are not offered to the public. The term ” private company ” is also defined in the Companies Act,2013. The Companies Act, 2013 regulates such a company and provides for Registration of private limited companies in India. In this article, we will focus on the Registration of private limited companies in detail.
Types of Private limited companies
There are four types of private companies:
- Limited by shares: private limited companies where shares limit the liabilities of the shareholders.
- Limited by guarantee: Private limited companies where the liabilities of the shareholders are limited by guarantee.
- Unlimited liability: private limited companies where the liabilities of the shareholders are unlimited.
- One person company: There is a 4th type of private company introduced in section 2(62) of the Companies Act of 2013, which is One Person company. It does not require two directors.
Advantages of Registration
Following are the privileges provided upon Registration of private limited company in the Act are as follows:
- No independent director: A registered private company doesn’t need to appoint an independent director as opposed to public companies, where they must appoint such a director.
- Additional grounds for disqualification: The registered private company can adopt additional grounds for the disqualification of their directors as per the Act.
- Separate legal status and perpetual succession: registered private limited companies are given legal status and have a feature of perpetual succession.
Registration of private limited companies in India as per the Companies act of 2013
The incorporation of a company means a legal procedure used to form an entity. Upon incorporation, the company gets a separate legal status and becomes a corporate legal entity. It gives a company the autonomy and capacity to sue and be sued etc.
Basic requirements for Registration of a private limited company
- Minimum of 2 Directors
- Minimum 1 director is a citizen of India
- Minimum of 2 members
- There is no restriction on a minimum paid-up capital per the latest amendment in the Companies Act of 2013.
Documents required for Registration
The documents required for the registration of a private limited company in India are as follows:
1.1. Documents to be submitted of directors/ members of the company
- Passport size photograph of the directors/ members
- Copy of Aadhar card/driving license/passport.
- Residential proof of all the directors of the company.
- If any director is an NRI(Non-resident Indian), a copy of the passport is necessary.
- Copy of PAN ( Permanent Account Number) card.
- Copy of educational qualifications of the directors.
- All the other essential details such as contact number, email id, and the current designation of the directors are to be submitted along with the above documents.
- The DIN( Director’s identification number ) of all the directors.Consent from the directors in the form of DIR-2
1.2. Documents to be submitted by the company
- The name of the company is to be submitted to the registrar’s office.
- Proof of registered office wherein the applicant is required to submit the notarized copy of lease/ rent agreement along with the evidence of paid rent amount for at least a month before applying.
- Copy of the MOA ( Memorandum of Association ) or AOA( Article of Association).
Steps for Registration of private limited company in India
Following are the steps of Registration:
Step 1: Prepare/ Obtain a DSC( digital signature certificate) wherein the DSC application form is filled with the required details and, most importantly, a digital signature of the relevant authority.
Step 2: Next step is applying for DIN ( Directors Identification Number), wherein the directors are required to fill Form DIR -3 and submit it to the registrar’s office along with the requisite fees and any document as required. The director will get a very important DIN number.
Step 3: Name Approval of the Company is done via filling out the RUN ( Reserve Unique Name) form along with requisite fees is done before the ROC( Registrar of Companies)
Step 4: The fourth step is to apply for a certificate of incorporation of the company.
Step 5: Such incorporation can be done by filing SPICE( Inc 32) as per the latest amendment in the Act. Along with all the required information, the digital signature is required to be done by the authority.
Step 6: The Next step is to file for e-MOA and e-AOA via form no. Inc 33 and Inc 34, along with the digital signature of the subscribers of the company to be incorporated
Step 7: The last and final step is to file form 49a for PAN and 49b for TAN.
After successfully filling these forms and following the steps mentioned earlier, the MCA( Ministry of Corporate Affairs) will approve the Registration and allocate a CIN ( Corporate Identity Number). The applicant can track the status using this number.
The incorporation of a company, whether private or public, is a very significant step for any company. All the private limited companies must be incorporated under the Companies Act of 2013. Registration of private limited company is completed within a range of 5-30 days, and then the company is successfully registered if all the required documents and steps are correctly followed.
Read our article:Cost Of Private Limited Company Registration in India