Monday, May 22, 2017

Company Registration in India!!!

A company is any body that engages in business. A company can be arranged in many ways, such as a partnership, sole proprietorship or a corporation. It depends on which type of company you are dealing with, that may be owned by one person or group of people.  

A registered / incorporated company in India is a company which is formed and registered under the Companies Act, 1956, including companies which are earlier registered under any of the previous company is called as the registered / incorporated company. Registrar of companies provides an identifying number and which is printed on the certificate of incorporation(ROC). This company indentification  number is unique in nature.



Advantages of registering a company in India

Establishing Business Bank Accounts:- 

To start a business bank account, you need to properly register your business with the state. And it is very important for separating your personal activity with business activity. It is more professional to give a business account details to your client than giving personal account details.

Getting Loans:- 

When you are applying for a small business loan you need to prove that you are actually a business. The lenders and investors are asking for business registration along with other documents. If you are applying for a credit card as business, creditors may also ask for business registration documents.    

Reputation with Customers:- 

Registering your business has helped to get a reputation for your company in front of your clients and especially other people whom you are not working with.   

Supplier Arrangements:- 

A registered business also helps you to receive supplier discounts that you wouldn't normally receive as an unregistered operation. 

Hiring Employees:- 

A registered company can hire full time employees and pay them according to state law. You will receive a state identification number after registering your business with state that allows you to route state taxes on the employee's behalf.  


Getting on Record:- 

Another major benefit with registering your business is safeguarding your business name. No one else can register the business with the same name Ministry of corporate Affairs ( MCA ) has ensured, every business can search the name of their business and if they find similar name, then we can choose a different name. 

Legal Liability Protection:- 

Another benefit is getting legal liability protection. If you are incorporating it is very easy to get business insurance, or attract investors, since they will know you are not personally responsible for the company’s well-being and you will not be personally responsible for certain accidents and other liabilities. 

Continuity:-

Continuity is another benefit that is registration provides a business continues even if you die or become ill. Registered company is an entity with its own rights thus another can provide ownership or control or your business can be sold.

Types of Company Registrations:-

Private limited Company 
LLP Company
One person company 
Partnership Firm
Sole proprietorship 

Private limited registration:- 

Prerequisites 

1. Have paid-up capital of INR 1,00,000
2. Need minimum of 2 directors/board members and two shareholders
3. Maximum of 50 members allowed in Pvt. Ltd
4. Cannot publicly sell shares. A Pvt. Ltd company can only invite people to buy shares by issuing a prospectus 

Step 1: - Acquire Director Identification Number. It is a unique identification number for an existing directory. According to recent amendments to the Companies Act 1956 the DIN is mandatory. Need 3 to 5 working days for this process.
Supporting documents required (soft-copies):

1. Proof of identity
2. Proof of residence
3. Photograph
4. PAN Card

Register on MCA website for login ID and password (create an account)

I. File E-Form DIN-1
1. Download E-Form DIN-1
2. Fill the form
3. Attach necessary documents
4. Sign using digital signature
5. “Check Form”
6. Upload E-Form
7. Pay fees
8. Note Service Request Number.
9. Check acknowledgement
10 Intimate approved DIN to your company
11. Download DIN- 2 Form 


Step 3- This is the final and major step that is applying for a company to be registered which contain incorporating company name, Registering the office address or notice of situation of office and notice for appointment of company directors, manager and secretary. And also about the take and pay for their qualification shares.

LLP Registration:-  

A limited liability partnership (LLP) is a partnership in which some or all partners have limited liabilities and it depends on the jurisdiction. Therefore, it shows elements of partnerships and corporations. In lap one partner is not liable for other partner’s misconduct.  

Prerequisites

Minimum of two partners and two designated partners with DPIN (Designated Partner Identification Number) just like DIN are required. 
No limit for maximum number of partners. 
It is not compulsory to make partnership deed or LLP agreement, but it may help in any dispute occurred.

Step1- Apply for DPIN for designated partners. 
Step2- Obtain digital signature 
Step 3- Apply for LLP name. First apply for company name in form 1A. 
Step 4 – Register LLP
Step 5 – Apply for PAN and TAN

One person company registration: -

One person company is a new concept introduced by The Companies Act, 2013 [No.18 of 2013]

Pre-requisites:- 

Only one share holder
The share holder can nominate any other person who can be share holder in case of death or incapacity of original share holder
Must have minimum of one director and maximum of 15 directors

Step 1- Obtain digital signature
Step2- Get DIN 
Step 3- Select suitable Company Name, and make an application to the Ministry of Corporate Office for availability of name.
Step5- Payment of Requisite fee to the Ministry of Corporate Affairs and also Stamp Duty. 
Step6- Scrutiny of documents at Registrar of Companies [ROC].
Step7- Get certificate from ROC 

Partnership Firm registration: - 

Pre-requisites: - 

Two persons are required as partners. 
Partners share their duties and responsibilities
More capital can brought into the business 

Step 1- Select suitable Company Name
Step 2- Create Partnership Agreement or Deed
Step3- Apply for PAN Card on the name of Partnership Firm.
Step4- Opening of Current Bank Account on the basis of PAN Card and Registered Partnership Deed. 

Sole proprietorship registration: - 

Pre-requisites: -  
  
Single owner for the business. 
Easy to start and easy to close 
Complete control resides on single owner 

Step1- Draft documents required for sole Proprietorship Registration.
Step2- Apply for the Service Tax or VAT.
Step3- Get Service tax or a VAT Registration Certificate.
Step4- Apply for a current bank account in any bank with complete documentation.

Registered company will be treated as a legal entity. It has a separate identity and existence of its own. In the case of unregistered company, the shareholders are liable for the transactions they do in the company's name. They are not separated from the company. In fact an unregistered company is non-existent, insignificant in the eyes of law.

For online legal consultancies from the best corporate lawyer to get clarity on registering your company visit the biggest online legal solution www.licit.ooo or can download the app https://goo.gl/L8GeYk  

1 comment:

  1. Nice post!!!!! Thank you for sharing with us!!!!!
    For Company formation in India , the client has to take into account many factors. In general for any business outings, one has to nitpick quite a few aspects for foolproof and assured establishment. But for a foreign client to do the same in India by self is very difficult.

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