Steps for Private Limited Company Registration in India

Private Limited Company Registration:

Selection of the right business structure is a major key factor close to making other business decisions are concerned. Private Limited Company Registration in India is the most preferred and favorable form of having a legal entity registered. It holds several benefits in the interest of new entrepreneurs building a start-up, stakeholders, or investors at large.

Private Limited Company Registration in India is rendered under the purview of Section 3 of the Companies Act, 2013. Concluding registering the Company as a Private Limited Company helps the business boost and run efficiently meeting all its significant business targets.

Before we proceed with the steps on how to register a Private Limited Company in India, let us have a basic understanding of the benefits of registering a Private Limited Company in India.

Below are a few benefits of having a Private Limited Company Registered in India –

• Separate legal entity differentiated from its members
• Limited Liability
• Perpetual Succession i.e., Business continuity
• Easy transfer of shares
• Borrowing funds easier
• Capacity to sue
• Tax benefits and exemptions
• Expansion and credibility
• Better governance
• Beneficial for Start-up’s using the Start-up scheme
• Easy exit and cost-effective

Private Limited Company registration steps are discussed below:

Evaluating the Business Structure –

The Company to be registered in India should evaluate and identify all the business structures options such as Limited Liability Partnership (LLP), One Person Company (OPC), Private Limited Company (PLC), and Public Limited Company based on the formation requirements before proceeding with the Private Limited Company (PLC) business structure to run its business operations smoothly and efficiently.

Formation Requirements –

• Shareholders – There should be a minimum of 2 shareholders and maximum limits of up to 200 in the Private Limited Company. Shareholders represent as the owners of the Company and subscribers to the Memorandum of Association (MOA). A shareholder can be any person or an individual, including a foreigner or a body corporate except in a Co-operative Society.
• Directors – There should be a minimum of 2 and a maximum of up to 15 directors, one of whom is an Indian resident. The first Directors are appointed by the members of the Company called ‘First Directors’ and are in charge of controlling the internal affairs of the business and responsible for all decision makings. Directors appointed in the Private Limited Company should obtain the Director Identification Number (DIN) while application of the web form (SPICe+ PART-B) which permits up to three directors.
• Name – The Private Limited Company registered should have a unique and eligible name that is not identical to any existing names under the Ministry of Corporate Affairs (MCA) or Registered trademark. The draft rules formed as the naming guidelines should be read while deciding the proposed name of the Company. The word ‘Private Limited’ is added at the end of the name of the Company.
• Registered Office – The registered office of the Company is the business address where all the business activity is to carry out and the address to be used for all communication. Per the Act, the owner’s residential address can be used as the registered office address of the Company given the laws prescribed under Section 12 of the Companies Act, 2013 are met which states, the applicant should obtain a No Objection Certificate (NOC) from the owner to use the property for business purposes.
• Capital – There is no minimum capital requirement for a Private Limited Company registration in India after adopting the Companies Amendment Act, of 2015. The capital to be infused at the start can be of any amount based on which the government fee is calculated while the incorporation process.
• Digital Signature Certificates (DSCs) – The subscribers and directors of the Private Limited Company duly appointed should obtain the Digital Signature Certificates (DSCs) under the Class-III category. The DSCs can be applied and obtained from any certified service provider which usually takes a day or two and is ready for attestation and filing purposes of e-forms.

Documents to be produced –

1. For registered office address –

• No objection certificate (NOC) from the owner of the property
• Rental agreement from the landlord where the property is on a rent basis
• Unique E-mail ID of the Company
• Proof of address i.e., any utility bill not older than two months (electric bill, telephone bill, water/gas bill)

2. For appointing the Directors –

• Copy of a PAN Card (a director who is of a foreign nation, a copy of passport)
• Copy of any Aadhar card/ Passport/Driver’s license/Voter ID
• Address proof can be a bank statement or utility bills
• Copy of photograph (passport size)
• Mobile number which is linked to Aadhar
• Official e-mail address

3. For the application of DSC –

• Identity proof – Aadhar, passport, PAN Card, driving license, bank statement any government-issued proof having name & address
• Address proof – Aadhar, utility bills, bank statements signed, Driver’s license, Voter ID, Passport, Property Tax receipts, any government-issued proof having name & address

Single web-based Application form –

The Private Company registration can proceed once the above requirements are catered. The applicant can register a Private Limited Company by login through the MCA portal selecting the e-form section and choosing the web-form SPICe+ as a new application.

Firstly, the applicant should use the PART-A section of the web-form SPICe+ online. PART-A allows the name reservation of up to two proposed names being filed by the applicant adhering to all the rules and regulations of the Act. The web form allows one resubmission without any fee, where, if the proposed name gets rejected after submission, the applicant can re-submit the web form with a new proposed name.

Once the proposed name is approved on the MCA Portal, the name is available for a tenure of twenty days, within which the applicant needs to proceed with the PART-B section of the web-form SPICe+ online. PART-B contains all the information pertaining to the incorporation of the Company, the subscribers, the directors, and the application to the DIN form. The applicant must draft and process with the e-MoA, and e-AoA, including other linked forms (INC9, Agile Pro) which on completion, the PDF should be downloaded and certified affixing the Digital Signature Certificate (DSCs) of the Directors and professional.

Once the web form is submitted on MCA post-pre-scrutiny check, a challan is generated by the system with a unique service request number (SRN). The amount of registration fee is to be paid online on MCA Portal. Post the examination and successful scrutiny of the e-form submitted by the applicant, the Registrar of Companies (ROC) will grant and issue a Certificate of Incorporation to the Company. This certificate can be seen on the MCA portal as well will be received at the registered email address of the Company, containing the Corporate Identification Number (CIN) and other details visible on the MCA Portal under the Company details section.

Conclusion

In such a way as the articles state steps on how to register a Private Limited Company registration in India and online having numerous benefits but to abide by the compliances and make the code of conduct more robust, a periodic check on rules and regulations, latest amendments calling for action is essential. Hence, one must keep in touch with a professional expert.

For any query or assistance required, feel free to reach out to our team of professional experts at Compliance Calendar LLP at info@ccoffice.in or connect over +91 9988424211.