Most of the businesses in contemporary times thrive to become a well-established company in long run. Many Startups look forward to go for a private limited company registration or for a one person company (OPC) registration rather than a public limited company because of certain added advantage in terms of autonomous functioning of the company and much more liberty.
What is a Company?
A company is a legal entity which is formed by a group of certain individuals with a motive to achieve the ultimate end goal of the organization as a whole. So as to clear the ambiguity which may prevail, regulations of company incorporation in India is derived by the provisions of Companies act, 2013. As per Companies act, 2013; A company may be formed for any lawful purpose by:
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- Seven (7) or more person(s), where the company so formed is to be termed as public company;
- Two (2) or more persons, where the company to be formed is to be a private company
- One person, where the company to be formed is to be One Person Company that is to say, a private company;
By subscribing their names or his name to a memorandum and complying with the requirements of the aforesaid companies act, 2013 in respect of company registration in India.
What is the procedure of Company incorporation in India?
The process of company incorporation in India is more or less the same for different form of companies which are to be registered in India. Whether you are looking for a private company registration in India or one person company (OPC) registration in India the two main governing body are MCA >>> Registrar of companies (ROC). In the purview of this we will discuss the steps required for company incorporation in India.
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|1||Name exploration||Search for a suitable business name of the company. Most crucial as it more or less reflects the nature of the functioning of the company. It is the name of the company which goes on forever till the life of the Company; therefore it must be given considerable time investment.|
|2||Digital signature certificate (DSC)||Digital signature authorises the identity of the holder and the possibility of forging a digital signature is minimised. Hence a digital signature certificate (DSC) becomes more reliable as compared to a free hand signature. For all the company official purposes it is advisable from the MCA that one should use DSC for all official work.|
|3||Directors identification number (DIN)||DIN is a unique identification number which is associated with identity of company’s director. As per companies act, 2013; it is mandatory to hold DIN for every director.|
|4||MOA/AOA||MOA & AOA are regarded as the basis for the functioning of the company in an effective and efficient manner. It not only defines the rules & regulations of the company but they also act as the guiding principles for the management and the employees.|
|5||PAN/TAN||Permanent account number (PAN) & Tax deduction & collection account number (TAN) is an important document in company registration process for every business since this helps in online ITR filing.|
|6||Certificate of Incorporation||After successful Submission of all the documents with the authorities within the stipulated time period a pre-screening of the documents is being done before releasing company incorporation certificate.|
|7||Current Bank Account||Last but not the least; open a current bank account with in registered name of the company. This process will require you to submit the incorporation certificate, MOA & AOA of the company with the bank. It is necessary to open a bank account so as to carry out business transaction in the name of the company.|
FREQUENTLY AKSED QUESTIONS (FDAQ’s)
Q). Is it mandatory to register a company in India?
Yes, it is mandatory to have your company registered with the Registrar of companies before actually proceeding with the operations of the company. To avail the benefits associated with different forms of companies you must ensure that the due process of company registration is complied with.
Q). How can I incorporate a company in India?
Company incorporation is a lengthy and cumbersome process and it requires the expert guidance to make the process of company registration smoother and less worrisome. Following steps need to be kept in mind for company registration in India:
- Provide ROC with a list of names for your business
- Apply for Digital signature certificate & directors identification number
- Apply for PAN & TAN for income tax compliances
- Finalise MOA/AOA of the company
- Get incorporation certificate
- Opening of current bank account in name of the company.
Q). How does Pvt Ltd company works?
The functioning of every private limited company is unique and different from the other. However the ultimate deciding authority is the promoter(s) who has the final say in the functioning of the company. Private limited company works directly under the purview of its owner’s discretion. Since the shareholding power of the company remains in few hands therefore the decision making here is fast & smooth unlike a public limited company.