The very first thing towards establishing a business is registering an entity. For the same purpose one needs to choose an entity among the various entities given under the Companies Act of 2013. In the present time the most preferred entity among the entrepreneurs is Private Limited Company. This is because of the various benefits and advantages this entity comes with. The very first thing towards the Private Limited Company registration is choosing a name which is as per the MCA naming guidelines for Private Limited Companies.
These MCA naming guidelines for Private Limited Companies must be followed in order to take name approval through the Form Spice+Part A. If the name of the entity is not as per the naming guidelines of the MCA, the name of the company will not be approved without which it is impossible to register a Pvt. Ltd. Company. Hence one must be aware about these naming guidelines.
What is a Private Limited Company?
A Private Limited Company is a type of company that requires a minimum of two directors and a paid-up capital of at least Rs. 1 lakh to start. This type of company can have up to 200 directors and provides numerous advantages. To register a Private Limited Company, you need to fulfill certain requirements, such as having a unique company name, a registered business address, and providing details about the key members. It’s necessary to have at least one director who is a resident of India. Before choosing to start a Private Limited Company, consider the investment required and ensure it fits your budget. This entity is quite versatile and suits various kinds of businesses, making it a common and favorable choice for many.
List of Things Which are not Allowed as Company Name
There are few general things which are not allowed under the MCA naming guidelines for Private Limited Companies as the name of the company:
- Name which has something obscene in it
- Vulgar words are not there in the name of the company
- Offensive words are prohibited to be used in the name of the company
- The name must be align with the section 3 of the Names and Emblems Act, 1956
- The name of the company must not have any kind of patronage of central or state government
- A name which is directly or indirectly matches the name of already existing company or Limited Liability Partnership firm
- Name of the company must not contain undesirable words given under rule 8 of Company Incorporation Rules of 2009
- Name of the company must align with the section 4 of the Trademark Act of 1999
Overview of MCA Naming Guidelines for Private Limited Companies
It is a known fact that to register a company it is compulsory to have a unique name without which it is not possible to register any kind of company in India. While finalizing any name for your company you must check that the name is aligning with the MCA naming guidelines for Private Limited Companies. Any name which is against the MCA naming guidelines for Private Limited Companies will not be given for your company. Hence one must ensure that the name you want to give for the name approval must be aligning with the MCA naming guidelines for Private Limited Companies. Some of the key things of naming guidelines are mentioned below:
Section 4 of the Companies Act of 2013
- For all the Private Limited Companies it is mandatory to have last word “Private Limited” in the name of the company
- The name must not be identical with the already registered companies
- Resemblance with the name of the already existing companies is not allowed
- Name must not be against any law for the time being enforce
- Name must not be undesirable in the point of view of central government
- The name of the company must not resembles with the name of any government authority
- The name must not make the general public to believe that the company is associated with the government
- The name must be used only after it got approved by the government of India
Rule 8 of the Incorporation Rules of 2014
Some of the rules which one must know so that a proper name of the company as per the MCA naming guidelines for Private Limited Companies can be taken are:
| Naming Guidelines | Example |
| Too much resemblance with the already existing company is not allowed | Swasth Pvt Ltd vs. Swassth Pvt Ltd |
| Just to make minor changes by making the name in plural form are not acceptable | Swasthik Pvt Ltd vs. Swasthiks Pvt Ltd |
| Minor changes like type and case of letters, spacing between letters, punctuation marks or make changes in special character used in the name of the company are not at all acceptable | ABCD Pvt Ltd vs. A.B.C.D Pvt Ltd |
Rule 8A of the Incorporation Rules of 2014
Rule 8A contains list of certain words which are undesirable and cannot be used in the name of the company as per the MCA naming guidelines for Private Limited Companies are:
- Words like ‘Board’, ‘Commission’, ‘Authority’, ‘National’, ‘Republic’, can’t be used in the name of the company
- Names of government positions like ‘President’ or ‘Minister’ can’t be used without government approval.
- Names should not give false impressions or contain misleading terms related to financial activities like ‘Bank’, ‘Insurance’, ‘Stock Exchange’, etc.
- Names shouldn’t be offensive to any community
- Names should not be mislead about a company’s activities
- Names should not misrepresent its scale of operations.
- Using names too similar to those of dissolved companies or companies struck off by the government is generally not allowed.
- Avoid using words indicating different types of business setups like ‘Cooperative’, ‘Trust’, ‘Society’, ‘LLP’, or ‘Partnership’ unless part of an approved scheme.
- Using names of famous people, foreign cities, or foreign countries without specific proof of business ties is generally prohibited.
- Descriptive names like ‘Cotton Textile Mills Ltd.’ and those likely to be confused with other existing companies will not be accepted.
Similar Names Considered
- Variations in the use of common expressions or minor changes in spelling may not be considered as distinguishable names.
- Abbreviated names (e.g., initials) may be allowed for subsidiary companies but not for joint ventures without an expanded name.
- No-objection certificates from persons whose names are included in the company name and proof of relation are required.
Additional Guidelines
- If a company changes its activities, it must update its name accordingly within six months.
- Declare if the proposed name has been used in any other business constitution in the last five years.
- Specific words are required for Section 8 companies and Nidhi companies.
- Companies that have changed their names can’t use their old names for three years
Conclusion
Selecting an appropriate name aligned with MCA naming guidelines for Private Limited Companies is not an easy task. The name chosen must comply with various stipulations, avoiding similarities with existing companies, undesirable or offensive terms, government affiliations, and misleading impressions about the company’s scope or activities. MCA’s guidelines prohibit names with certain words, misleading terms, or resemblances to dissolved companies.
Notable restrictions include the use of specific titles, foreign locations, and specific business setups without proof of association. Alterations or minor variations in common expressions might not suffice as distinguishable names. The guidelines further demand timely name adjustments if a company alters its operations and prohibit reusing old names for a specified duration. Adhering to these regulations ensures successful approval of the chosen name, essential for registering a Private Limited Company in India.
