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    Online Company Registration

    Steps to Register a new Company

     

    Apply for the name of the company to be registered by filing Form INC-1 for the same. After that depending upon the proposed company type file required incorporation forms listed below.

    Form INC-7 or Form INC-2 : Form INC-7 for Application for incorporation of a company (Other than OPC) or Form INC-2 for Application for Incorporation of OPC.

    Form INC-22 : Notice of situation or change of situation of registered office based on the option chosen in Form INC-7.

    Form INC-22 is to be filed within 30 days from the date of Incorporation of OPC (If the registered address is different from the address given in Form INC-22) or other than OPC (if not filed earlier).

    Form DIR-12: Particulars of appointment of directors and the key managerial personnel and the changes among them. This form is to be filed by OPC in case promoter is not the sole director or there are more than one director in an OPC.

    Other Requirements of the private limited company:

    There should be at least two directors of the company.

    The two directors will be the subscriber of the memorandum and they subscribe the minimum capital.

    Minimum capital for a private company is INR 1,00,000/-

    Registration fee is depending upon the authorized capital of the company. It should be equal or more than the subscribed capital of the company.

    Regarding non-resident interest in the company Foreign Exchange management Act is controlled all the issue. You can invest up to 100% depending upon the type of industry.

    What is the procedure in obtaining a name approval for the proposed Company?

    An application in Form No. 1A needs to be filed with the Registrar of Companies (ROC) of the state in which the Registered Office of the proposed Company is to be situated.  The application is required to be signed by one of the promoters. The details to be state in the said application are as follows:

    • Four alternative names for the proposed company. (The name can be coined names from the objects of the proposed company or the names of the directors, etc. but should definitely be indicative of the main object of the company. Justification for the name needs to be specified along with the application)
    • Names and addresses of the promoters (Minimum 7 for a public company while 2 for private company).
    • Authorized Capital of the proposed company.
    • Main objects of the proposed company
    • Names of other group companies. On submitting the application, the ROC scrutinizes the same and sends the approval / objections in about 10 days to the applicant. On fulfilling of the objections a formal letter of name approval is issued.

     

    When can the newly formed company start its business operations? On receipt of the certificate of incorporation, the public company has to complete certain other legal formalities such as a statutory meeting (within 6 months), statutory report, etc. On completion of the said formalities and on filing of the statutory report with the ROC the ROC issues the certification of commencement of business to the company. Thereafter, the Public Company can start the business operations. The Private Company can start its business immediately on incorporation.

    Public Limited Company Registration

    What is a Public Limited Company?

    A Public Limited Company is a Company limited by shares in which there is no restriction on the maximum number of shareholders, transfer of shares and acceptance of public deposits. The liability of each shareholder is limited to the extent of the unpaid amount of the shares face value and the premium thereon in respect of the shares held by him. However, the liability of a Director / Manager of such a Company can at times be unlimited. The minimum number of shareholders is 7.

    What are the advantages of a Limited Company?

    A limited company has following advantages:Members' (the directors and shareholders) financial liability is limited to the amount of money they have paid for shares. The management structure is clearly defined, which makes it easy to appoint, retire or remove directors. If extra capital is needed, it can be raised by selling more shares privately.
    It is simple to admit more members. The death, bankruptcy or withdrawal of capital by one member does not affect the company's ability to trade. The disposal of the whole or part of the business is easily arranged.
    High status.

     

    What are the disadvantages of a Limited Company?

    A limited company has following disadvantages: Requirement to register the company with the registrar of companies and provide annual returns and audited statement of accounts. All details of the company are available for public inspection so there can be no secrecy. There are penalties for failing to make returns. Can be more expensive to set up. May need professional help to form. As a director, you are treated as an employee and must pay tax. The advantages of limited liability status are increasingly being undermined by banks, finance house, landlords and suppliers who require personal guarantees from the directors before they will do business.

    What entity is best suited?

    The choice of entity depends on circumstance of each case. Private Limited Company has lesser number of compliances requirements. Therefore, generally where there is no requirement of raising of finances through a public issue and the ownership is intended to be closely held by limited number of persons, Private Limited Company is the best choice.