Rules and Regulations to incorporate a Private Limited Company
Incorporating a Private Limited Company as per section 3 of the Companies Act, 2013 is the most popular and reliable form of business due to its added advantages and reliability. To incorporate the company as Private Limited in India there are certain rules and regulations to be complied to abstain from additional fee, fine/penalty.
The Private Limited Company set up implicates certain advantages such as being a separated legal entity, having limited liability, perpetual existence, leading to business continuity, no requirement of minimum paid up share capital, opportunity to raise or issue funds from public platforms with less government interference and more tax benefits.
BASIC REQUIREMENTS FOR INCORPORATING A PRIVATE LIMITED COMPANY IN INDIA:
|Description||Pre-Requisites||Points to be noted|
|Shareholders||Minimum – 2||Maximum – 200||Individual, or artificial body|
Minimum – 2
Maximum – 15
|Natural Person, having a DIN (Director Identification Number) and Digital Signature Certificates under MCA for filing purposes.|
|A Unique name, not identical to existing names registered under MCA. Inclusion of term ‘Private Limited’ at the end.||Name reservation should resemble the brand or business, avoid usage of any abbreviations.|
|Registered Office||Details of the Address where the business activities are to be carried out, address proof i.e., utility bills, bank statement, deeds.||Post incorporation, the Name board of the Company with address, CIN is to be placed at registered office and publish in English and vernacular language;
letter head/ notice and documents per section 12(3) and 12(3)c of the Act, 2013.
|Share capital details||If a private company is to be incorporated with share capital, then break up of authorized and paid-up share capital should be clearly given.||Authorized and paid-up share capital should be divided into a number of shares and nominal value per share.|
|Business Activity||The business activity of the company should be clearly mentioned||The correct business activity code should be selected.|
The rules and regulations to incorporate the Private Limited Company can be followed through an integrated single-form application i.e., the SPICe+ form which is divided in Part-A and Part-B, being a web-based integrated form available on the MCA portal.
GUIDE TO INCORPORATE THE PRIVATE LIMITED COMPANY THROUGH MCA
Part-A of SPICe+ form (name reservation) – This part of the form is for name reservation, permits two names which can be proposed. In case of any rejection of the proposed name application, the applicant can resubmit the form once without incurring any extra filing fees. If filed together with Part-B then, the web-form allows only one proposed name, and once the details gets filled and pre-scrutiny is validated, the applicant can proceed by clicking “submit”. Once the Part-A is submitted the web form enables Part-B of SPICe+ integrated form.
Part-B of SPICe+ form (incorporation) – This part encompasses the company incorporation with all other services, uploading the form with information including subscribers and directors name, registered office address, capital of the company, DIN application along with other applications such as application of Permanent Account Number (PAN) and Tax Deduction Account (TAN), GSTN Application, EPFO an ESIC registration, Profession Tax Registration (only for Maharashtra), opening of a bank account.
Once the stated information is processed and pre-scrutiny check is successful the form can be submitted. Thereafter the PDF format is to be downloaded to affix the DSC certifying the web form which would enable the linked forms.
The applicant needs to fill up the linked forms which is to be uploaded on MCA Portal. These linked forms are as follows:
· e-MOA, E-AOA (INC-33 and INC-34) form,
· AGILE-PRO Form which is the new form adopted, (previously INC-35) for EPFO registration and ESIC registration and is mandatory.
· INC-9, the declaration form will be auto-generated and available for downloading and affixing the DSCs.
The Part B would include documents such as identity proof of directors and subscribers, address proof, passport size photographs, declaration/ consent of the directors, and subscriber, address proof of registered office, utility bills, a declaration from Chartered Accountant (CA), Company Secretary (CS) or Cost accountant.
Upon successful submission of the above, a unique service request number (SRN) would be generated where the payment is to be made for the incorporation of the Company. The registration fee for the SPICe+ web form Part A is INR 1000. Upon completion of the process and approval of the incorporation, the Private Company is allotted a Corporate Identity Number (CIN) and can be checked on MCA Portal.
Notwithstanding, as we know Private Limited Company is the most suitable and preferred having its own added advantages and benefits in interest of owners as well as investors, one must seek the necessary help and guidance required to understand the legal implications, be at par with the compliances and regulations for smooth running of the business forming a great brand, flexibility leading to expansion and diversification in the market.