Introduction on how to register a company
You can’t run a business in India without registration: it’s illegal and can cause some legal difficulties. The Central and State Governments have taken a variety of steps in recent years to help entrepreneurs how to register a company in India.
Such fast-track processes allow startups and smaller companies to become legal and register a company.
There are also many advantages to register a company in India:
- You may increase industry
- Make use of programs
- Subsidies
- Incentives
- Other public benefits
- And when you operate with a duly registered company in India, you receive protection under various Indian laws.
Fact: Company is an established and licensed group in compliance with this Act or any prior company law.
In India, the founders or directors are required to remain active in the ‘legal game’ when establishing a business or company. The first step to set up register a company is to ensure that all the required documents are produced very carefully. All efforts will be lost if there is an error in the documents needed to register a company in India. For a corporation to be licensed, several legal formalities can be found in this article on how to register a company in India. In this post, we have referred to the most relevant documents that can support you during the process of how to register a company.
Under the Company Act of 1956, following are the features of a company:
- A company is a people’s organization established and registered under this Act or to any prior law of the state.
- A corporation is a separate legal body from its shareholders.
- The disparity between people who have power over the operation of an organization and the people who own it is an essential feature.
How to register a company in India through different structures?
There are various rules and regulations in India to register a company in different forms. The form of business registration would depend on characteristics, advantages, business registration procedures, investment incentives, tax regulations, required documentation, maximum turnover restriction, shareholder trends, and regulatory enforcement.
Various types of company structures to register a company:
1. Private Limited Company
Private Limited Company is the most common on this list of how to register a company. A Pvt Ltd Company is a private corporation where at least two directors are required to register a company for “private limited company.”
The process of how to register a company in India:
- Apply to the Digital Signature Certificate (DSC) and the Director’s Pin (DPIN).
- Provide at least three possible company names to register a company.
- Draft the Association Memorandum (MOA) and the Association Articles (AOA) to learn how to register a company in India.
- Request for Corporate Identification Number (CIN) and Certificate of Incorporation.
- Get your Permanent Account Number (PAN), Tax Deduction, and Collection Account Number (TAN).
Note: The applicant can apply for registration of the new company after the name approval by filing the required forms (Forms 1, 18 and 32) within 60 days of the name approval.
2. Public Limited Company
A Limited Liability Corporation is a large business that can collect people’s funds instead of other shares. There should be at least seven shareholders, 3 of whom should be managing directors, and the company should own minimum share capital of five lakhs to register a company in India.
The process to register a company:
- A minimum of 7 shareholders is required to create a public limited company.
- Minimum 3 directors shall be required to form a public limited company.
- Minimum Rs. 5 lakh capital share needed to register a company in India.
- One director requires a Digital Signature Certificate (DSC) for how to register a company.
- The managers will need DIN to register a company in India.
- Submit the application form along with MoA and AoA and the form to be filled out, including Form DIR – 12, Form INC – 7, and Form INC – 22.
- Registration fee charge to ROC.
- After obtaining approval from ROC, the company should apply for a ‘Certificate of Commencement of Business.’
3. How to register a company as a Sole Proprietorship Firm
Sole Proprietorship Companies is a legal organization where the corporation and its proprietor are not separated. This kind of company is an individual business owner or individual business owner who does not have a limited liability policy for operating the business.
Registration Process:
- No procedures are established to register a company, but these procedures are recommended.
- Apply for Small and Medium Enterprise (SME) for how to register a company in India.
- According to local land legislation, obtain a license under the Shop and Establishment Act to register a company.
- If the annual turnover exceeds Rs. 20 Lakh, apply for GST registration.
- Get proof of address for the Sole Property firm office to learn how to register a company.
Fact: Select at least one proper name up to a maximum of six names, indicative of the company’s main objects, in order of preference.
4. Limited Liability Partnership
A Limited Liability Partnership is a company in which all partners have the right to manage the company’s operations, but limited liability for the actions of the company. There is no minimum capital contribution required for how to register a company in India for LLP.
The process to register a company in India:
- Application for online application for DSC of all approved LLP partners.
- Use a DIN for all LLP directors through CS/CEO or company MD to register a company in India.
- Book a single LLP name that does not resemble other firms to register a company efficiently.
- Establish an LLP agreement controlling partners’ rights and responsibilities.
- Provide registration documents of all required partners and LLP documents.
5. Register a company in India as a Partnership firm
A partnership firm is a legal agreement between two or more people to exercise their business and share their profits through a partnership agreement. For the registration of a partnership company, there are no conditions of minimum capital investment.
How to register a company as a Partnership firm:
- Choose a unique name for an MCA valid partner company to register a company in India.
- Draft a partnership agreement that provides descriptions of how to register a company in India, partnership participation, partnership length, solvency rules, ratios for benefit sharing, etc.
- Complete the Act and be notarized on stamp paper to register a company in India.
- Request a PAN card on behalf of the company to register a company.
- Submit a registration form along with the registration document on how to register a company.
- Send the application form with all other relevant documents to pay the fees for registration and stamping according to the country’s laws to register a company in India.
- To register a company, request a Registrar Registration Certificate.
Note: Company Registration process in India is entirely online.
6. Register a company as a Non-Banking financial company
NBFC is a finance company offering loans, loans, and insurance on the list of how to register a company in India. While they can supply services similar to banks, the NBFCs vary from banks to register a company. Two types of NBFCs can accept deposits and the other that can not accept deposits.
Registration Process:
- Next on the list of how to register a company, under the company law of 2013 or 1956, the company should be registered.
- The minimum net fund owned by the company should be Rs . 2 Crore to register a company.
- There should be a minimum of 1 director with the same background to register a company in India.
- Clean CIBIL documents should be open to the company to know how to register a company in India conveniently.
- Online application form to be completed with the required documentation on the official RBI website once all the above conditions have been fulfilled.
- The CARN number is generated on how to register a company in India.
- A hard copy of the application form must also be sent to the regional branch of RBI to register a company.
- Once the application has been verified and approved, the license will be issued to the company.
7. Micro Finance company
Micro Finance Company provides small businesses and low-income individuals with instructions on how to register a company in India, such as deposits, credit, loans, and insurance, without needing collateral or protection. MFCs must have at least Rs. Five crores paid-up capital to register a company in India.
How to register a company in India under MFC:
- Register a company and get a certificate of incorporation under the Companies Act.
- Open a bank account and deposit the amount received after establishment into your bank account as a permanent deposit.
- Apply for the MFC license online, along with all relevant documents, at RBI’s official website on the section on how to register a company.
- When submitted, the RBI assigns your business a company application number (CAR).
- In the case of an authentic application and documentation on how to register a company in India, RBI is authorized and can begin operation as an MFC.
Fact: Authorized capital or registered capital is the maximum capital ceiling for a company to issue shares and collect money from its shareholders
Some ways to register a company
Today, most companies have an agent, chartered accountant, or company registration agency to know how to register a company. Instead of signing up for online or DIY in India, there are solid reasons for hiring third parties to register a company.
1. How to register a company in India all by yourself
You can register a company in India yourself, as the term implies. Sadly, the process of approvals for this business has a big reversal: it must take significant time, effort, and resources to get the requisite documentation from different governmental departments. You could fall prey to illegal suits if you don’t read how to register a company in India.
Note: You have to follow all the standard procedures for registration of any business
2. Register a company through your Lawyer/Chartered Accountant
This is the easiest way to register a company in India. This is because they provide a single-window solution, use their experience, skills, and contacts to register a company in India.
3. How to register a company online
How to register a company in India online? It is simple nowadays. Visit the Corporate Ministry website and access the required forms available on how to register a company. Fill and submit the necessary fees online. Several companies in India are providing the register a company with startup culture gaining ground.
Fact: Registering a company under startup India movement as a startup company is a very Simple and online process
4. Search on Google to register a company
A simple search of Google will reveal dozens of such agencies offering services for how to register a company in India. This method can also be chosen to register a company. However, ensure that an online agency is legitimate in registering companies and has established track records. Else, you might be the victim of a scam. Some offer a complete set of registration services for only Rs.4,999. Read the terms and conditions carefully to register a company.
5. How to register a company through Municipal corporation
This means you get a municipal license under the municipality’s Shop & Establishments Act, where you start your business. It might sound effortless and economical. However, running a business with just a municipal license often has significant disadvantages.
Note: AOAs are the necessary documents to be submitted when incorporated with the Registrar of Companies (ROC).
How to register a company in India – Steps
The Companies Act, 2013 lays down the rules for the incorporation of both public and private companies following Chapter II of the Act and the Rules of the Companies (Incorporation) Regulations, 2014.
To register a company as a private company must have a minimum paid-up capital of Rs . 1, 00,000 and a minimum number of members required to form a private company of 2 or more members.
The required paid-up capital of Rs. 5 00,000 must be sufficient for the public corporation, requiring a minimum of seven or more shareholders for how to register a company in India.
1. Select the name of the person to register a company in India
Under Section 149(1)(a) of the Companies Act, 2013. Select the name of the directors, i.e., who will be directors (At least Three Names for Public Company Three and Two Names for Private Company) [Rule-17] (Companies (Incorporation) Rules, 2014). This is compulsory to register a company in India.
2. Apply for Digital Signature Certificate (DSC)
Digital Signature Certificates (DSC) are the digital equivalent (i.e., electronic format) of physical or paper certificates on the list of how to register a company. For a specific purpose, certificates serve as proof of an individual’s identity to register a company. A digital certificate can also be electronically displayed to prove your identity, access information, or services over the Internet or to subscribe to other documents automatically. By signing MCA-21 E-forms digitally, you can get DSC signed to register a company in India.
The digital signature is provided by a certified Certifying Authority ( CA). Certifying Authority ( CA) means an individual given a digital signature certificate. On the MCA site (www.mca.gov.in), you can view CAs and their contact information about how to register a company in India. Among all the Certifying Authorities, the DSC fee is different to register a company in India.
Documents required for DSC to register a company in India:
When it comes to register a company in India, directors and business partners may apply to India for a DSC (Digital Signature Certificate) form. According to the application form and how to register a company in India, the documentation required to receive DSC may differ.
The following are the guidelines that should be followed when submitting the DSC application to register a company in India:
- The claimant’s signature must be the same as that of his Identification Evidence to register a company.
- The signature of the applicant shall be in Blue Ink to register a company in India.
- The applicant must sign in the application form via his/her photo.
- The applicant should be issued with all relevant documentation attested by the Bank Manager, the Gazetted Officer, or the Postmaster to register a company in India.
Note: It is needed to fill the form electronically with the concerned department for Company Registration of a private company, DSC, for one of the Directors.
3. Apply for Director Identification Number (DIN)
It is a unique identification number assigned to the company’s current director or intended to be appointed as director of the company according to Section-152(3), Section-153 & Section-154 of the Companies Act, 2013 to register a company.
Only after the approval of the DIN through how to register a company in India, can the incorporation documents be filed with the Registrar Form No.-DIR-3. However, the consent of the name may be obtained before the support of the DIN. It takes about seven days for the DIN to be accepted, given that all appropriate documentation is issued. The fees to register a company is charged for the allocation of DIN are Rs.500.
To register a company in India, Indian Nationals will require the following documents for DIN:
- PAN Card – A PAN Card copy should be submitted to register a company by the proposed Company Director. The Indian Department of Income Tax issues a specific PAN (Permanent Account Number) identification number for how to register a company. For all matters concerning the Company, the Ministry of Corporate Affairs uses the name of the manager on the PAN card. Therefore, the director must ensure that there is no error in his / her name on the PAN Card.
- Address proof – An address proof should be provided by the proposed company director to know how to register a company in India. As specified in the PAN card, it should have the latest address and name of the owner. Make sure the document is at least two months old to register a company.
- Residential Proof – The director must apply residential evidence and address proof to register a company in India. For validating the current address of the owner, the residential proof is required. As specified in the PAN card, the director’s name should be not less than three months old for how to register a company.
4. Filing the proposed name
In the process of how to register a company in India, it is the most important thing. A name that identifies the business object must be retained to register a company. Name that is relevant and easy to remember should be used for how to register a company. As per the Guidelines on Name availability, the name of the company proposed should not be identical to that of an already existing corporation and should not also bear any registered trademark term.
Other guidelines regarding Name clause to register a company are:
- The name mentioned in the memorandum does not mean that, for the moment in practice or the view of the Central Government, its use by the company constitutes an offense under any statute.
- The provisions of Section 3 of the Emblems and Names (Prevention and Improper Use) Act, 1950 (12 of 1950) to register a company.
- Includes, but with the permission of the owner or the applicant to register a company in India, the name of a licensed trademark or of the trademark that is subject to the registration application.
- It contains any phrase or term that is derogatory to any part of the population for how to register a company.
- Financing, lending, chit funds, savings, shares, or a variation thereof shall be the main business of that organization unless the name implies some specific financial operation (e.g., Chit fund, etc.). This name shall not be authorized.
Fact: The documents required for company registration are: Directors&Shareholders Documents, Passport size photograph, PAN Card Copy (mandatory), Address Proof, and Bank Statement.
5. Drafting of Memorandum of Association to register a company in India
The MoA is the Company Constitution that must contain all of the company’s vital information for how to register a company. MoA defines the relationship between the company and its shareholder. Therefore, with proper incorporation of Clauses, the meticulous drafting of the MoA is required to register a company.
It is appropriate to draft a memorandum to register a company in which:
- In the case of a public limited, or the last terms of “Public Limited” in the case of a private limited undertaking, the name of the corporation shall begin with the word “Limited” to register a company.
- The state in which the company’s registered office will be situated should be mentioned on how to register a company.
- The aim of the company proposed to register a company.
- Members of the Limited / Unlimited company shall be liable.
- In case of a company having the share capital, mention the amount of the share capital under how to register a company in India.
- In the case of the One Person Company, the name of the person who becomes a member of the corporation in the event of the death of the client.
6. Drafting Articles of Association
AoA is an important document that outlines how to register a company in India, the reason for which the company is formed. Along with information on the appointment of directors and the management of the company’s financial record is required to register a company.
In the preparation of the AoA of the company, it shall contain:
- Company management legislation to register a company.
- It shall include as well as prescribed matters on how to register a company in India.
- The provision of the article’s securement requirements can not be modified unless criteria or procedures are satisfied or compiled in the case of a special resolution that is more stringent than those applicable.
Fact: When AOAs are in conjunction with the MOA, they are called the Constitution of the Company.
7. Certificate of incorporation
If the Registrar is wholly convinced that all conditions have been met by the company which is incorporated, he shall register a company and issue a certificate of incorporation. As a consequence, the incorporation certificate issued by the Registrar is direct proof that all the provisions of the Act have been complied with.
Conclusion
Although the MCA registration process of how to register a company in India is simple, it is always best to seek professional advice when registering your business. Many decisions need to be taken before forming a corporation to register a company. For marketing your company, you can get in touch with InfluenceMojo.com
Link : https://timesnext.com/how-to-register-a-company-in-india/
Author :- Aakriti Suri
July 02, 2020 at 10:37AM
TimesNext