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Private Limited Company Registration Total Time : 18 days


Private Limited Company Registration

Private Limited Company in india is the most prevalent and popular type of corporate legal entity. Private limited company registration is governed by the Companies Act, 2013 and the Companies Incorporation Rules, 2014. To register a private limited company in india, a minimum of two shareholders and two directors are required. A natural person can be both a director and shareholder, while a corporate legal entity can only be a shareholder. Further, foreign nationals, foreign corporate entities or NRIs are allowed to be Directors and/or Shareholders of a Company with Foreign Direct Investment, making it the preferred choice of entity for foreign promoters.

Unique features of a registering a private limited company in india like limited liability protection to shareholders, ability to raise equity funds, separate legal entity status and perpetual existence make it the most recommended type of business entity for millions of small and medium sized businesses that are family owned or professionally managed.

easeURbusiness is the market leader in company registration services in India, offering a variety of company registration like private limited company registration, registering one person company in india, registering public limited company in india, limited liability partnership (llp) company in india, Producer Company Registration and Indian Subsidiary registration. The average time taken to complete a company registration is about 10 - 15 working days, subject to government processing time and client document submission. Get a free consultation on company registration and business setup in India by scheduling an appointment with an easeURbusiness Advisor.


5 STEPS FOR COMPANY REGISTRATION


1. Application of DSC & DIN:

First of all, the partners have to apply for Digital signature and DIN. Digital signature is an online signature used for filing and DIN refer to Directors PIN number issued by MCA. If the directors already have DSC and DIN, then this step can be skipped.

2. Name approval:

You need to provide 3 different options for your company name to MCA of which one will be selected. Names provided should ideally be unique and suggestive of company business

3. MOA & AOA submission:

Once name is approved, one needs to draft Memorandum of association and Articles of Associate. Both MOA and AOA are filed with the MCA with the subscription statement.

4. Get incorporation certificate:

It typically takes 15- 25 days to form a Private limited company and get the incorporation certificate. Incorporation certification is a proof that company has been created. It also includes your CIN number.

5. Apply for PAN, TAN and Bank account:

Then you need to apply for PAN and TAN. PAN and TAN are received in 7 working days. Post this, you can submit the Incorporation certificate, MOA, AOA and PAN with a bank to open your bank account.


Reasons to Register a Private Limited Company


1. Separate Legal Entity

Private Limited Company is a legal entity and a juristic person established under the Companies Act. Hence, a company has a range of legal capacities and the members (Shareholders/Directors) of a company have no personal liability to the creditors of a company for company's debts.

2. Uninterrupted Existence

Private Limited Company has 'perpetual succession', meaning uninterrupted existence until it is legally dissolved. A company being a separate legal person, is unaffected by the death or other departure of any member and continues to be in existence irrespective of the changes in ownership.

3. Borrowing Capacity

Private Limited Companies can raise equity funds in India. Companies can also issue equity shares, preference shares, debentures and accept deposits with RBI permission. Banks and Financial Institutions prefer to provide funding to a company rather than partnership firms or proprietary concerns.

4. Easy Transferability

Ownership of a business can be easily transferred in a company by transferring shares. The signing, filing and transfer of share transfer form and share certificates is sufficient to transfer ownership of a company. In a private limited company, the consent of other shareholders maybe required to effect share transfers.

5. Owning Property

Private Limited Company being an artificial person, can acquire, own, enjoy and alienate, property in its name. The property owned by a company could be machinery, building, intangible assets, land, residential property, factory, etc., No shareholder can make a claim upon the property of the company - as long as the company is a going concern.


ADVANTAGES OF REGISTERING A PRIVATE LIMITED COMPANY IN INDIA?


There are multiple reasons to register a private limited company in india:

1. Preferred by banks, VCs & investors.

2. Easy to allocate and redistribute shares to investors or other directors.

3. Separate legal entity which limits your liability.

4. Offers the flexibility of a partnership firm and the advantages of a Public Ltd Company.

5. Easy to register, manage & run.

6. Easy to dissolve or wind-up.


CONCERNS RELATED TO REGISTRATION OF PRIVATE LIMITED COMPANY


1. Private Limited company requires few more ROC compliance translating into an additional cost of 5000 to 10000/annum.

2. Minimum capital required is Rs.100,000.

3. Private limited company can have a maximum of 200 members.

Still, entrepreneurs prefer private limited for the ease in share transfer and potential for future growth.


FACTORS NEEDS TO BE CONSIDERED IN COMPANY NAME SELECTION


The name of your company is very important. It is the first impression to your buyers, suppliers and stakeholders. It should, therefore, be relevant, suggestive and attractive. There are various factors that you should keep in mind while naming for your company.

1. Short & Simple

The name should be concise and not be too long. People should be able to pronounce it easily and they should be able to remember your company.s name the first time they hear or read it.

2. Meaningful

The name of your company should be related to your business. It should fit the company's branding. For example, Infosys refers to information systems or IT technologies.

3. Unique

Name of your company should not be same or identical to an existing company or trademark. You can go to Company Name Search to check if your company name is identical to others. You should ideally avoid plural version e.g., "Flipkart's" or changing just letter Case, spacing or punctuation marks in an existing company name.

4. Suffix

The name of your company should end with the suffix "Private Ltd" in a case of registering a Private limited company in india and "LLP" is a case of registering a limited liability partnership company in india.

5. Should not be illegal / offensive

The name of your company should not be against law. It should not be abusive or against the customs and beliefs of any religion.