Registration of a company in India depends on a number of factors for businesses looking to incorporate their entity under the Companies Act of 2013. Given below are some FAQs and their respective answers so that entrepreneurs can clearly identify and choose the right form of company to conduct their business.
FAQs on Company Registration
Given below are some essential FAQs on registration of company in India:
Q1) What is a Private Limited Company as per Indian laws?
A private business is a separate legal entity with perpetual succession and limited liability up to the amount of money invested. A shareholder is not personally liable for the debt and his personal assets will not be attached to pay it.
Q2) Can a small firm in India choose to register as a private limited company?
Yes, a small firm can register as a private limited company in India, which provides credibility and a positive image to suppliers, customers and financial institutions. It also facilitates easy access to loans and contracts.
Q3) What is the procedure for Private Limited Company registration in India?
Private Limited Company registration can be done through SPICe Plus (SPICe+), a web form that combines name reservation, incorporation, DIN allotment, PAN, TAN, EPFO, ESIC, Profession Tax (Maharashtra) and bank account opening.
Q4) What are the documents required for the Private Limited Company Registration?
Documents required for Private Limited Company registration include photographs and PAN cards of all directors, ID proof and address proof for the registered office.
Q5) When should I file the Annual returns of my Pvt. Ltd. Co.?
Private Limited Companies must file their annual accounts and returns, including Form MGT-7 (Annual Return) and Form AOC-4 (Financial Statements), within specified timelines.
Q6) What are the benefits of a Private Limited Company in India?
Private Limited Companies offer limited risk to personal assets, separate legal entity status, limited liability to shareholders and easy transferability of shares, making it an ideal choice for businesses.
Q7) What is the minimum turnover and capital required for Pvt.Ltd.Co. in India?
There is no specific minimum turnover or capital requirement for a Private Limited Company in India.
Q8) Can one person start a Pvt. Ltd. Co. in India?
One person can start a One Person Company (OPC) in India, but to register a Private Limited Company, a minimum of two directors is required.
Q9) Is registration necessary for Private Limited Companies in India?
Yes, registration is necessary for a Private Limited Company to establish its legal existence.
Q10) What is the ROC compliance for a Private Limited Company?
ROC compliance for a Private Limited Company includes filing Form MGT-7 (Annual Return) and Form AOC-4 (Financial Statements) with the Registrar of Companies annually.
Q11) As per Indian law, how many maximum directors can a Private Limited Company have?
As per Indian law, a Private Limited Company can have a maximum of 15 directors.
Q12) Do Private Companies have to release annual reports?
Private Limited Companies are not required to release annual reports for public access.
Q13) What is the Indian Companies Act, 2013?
The Indian Companies Act, 2013 consolidates and amends various aspects of company registration and governance in India.
Q14) What is Authorised Capital and what is the minimum authorised capital for registering a company?
Authorised Capital is the maximum limit of capital a company can issue and collect from shareholders. The minimum authorised capital for a company registration was Rs. 1 lakh prior to the 2015 amendment and now there is no such need.
Q15) Can foreigners register and become the owners of an Indian-registered company?
Yes, foreigners can register and become owners of an Indian-registered company, but there must be at least one additional Indian director to launch the company.
Q16) What is the Start-Up India initiative?
Start-Up India is a government initiative to promote entrepreneurship in India, encouraging innovative and start-up businesses.
Q17) Is there a need for physical presence for Private Limited Company incorporation?
No, physical presence is not required for Private Limited Company incorporation as the entire process can be done online.
Q18) Why is it necessary to register a company?
Company registration is necessary to establish the legal existence of the company and open a current bank account for business transactions.
Q19) Can I run a company without registration?
Sole proprietorship may be run without registration, but for tax and licence requirements, it is advisable to register with the local government.
Q20) Can a company be registered without GST?
All small enterprises are required to register for GST in India.
Q21) What are the minimum requirements to register a company?
The minimum requirements to register a company include two directors and two shareholders, one Indian resident director, PAN card and address proof for directors and shareholders.
Q22) What are the benefits of company formation in India?
Company formation offers limited liability protection, credibility, easy access to credit and investment and better manpower attraction.
Q23) What is MOA and AOA?
MOA and AOA are very significant documents essential for the process of registering a company in India.
The Memorandum of Association, also called MOA is a significant legal document that provides fundamental information about the company. It includes essential details such as the company’s name, registered office address, main objectives, authorised share capital and particulars of the initial shareholders.
The AOA is another legal document that lays down the internal rules, regulations and bylaws and also simultaneously sets the guidelines for how the company will be run, defining the roles and responsibilities of the shareholders, directors and other officers.
Q24) Can I change the registered office address of my company after incorporation?
Yes, you can change the registered office address of your company after incorporation. The process for changing the registered office involves filing the necessary forms and documents with the ROC. The change must be communicated to the ROC within the specified time frame and any required approvals from shareholders and creditors should be obtained.
Q25) Can I convert my existing partnership firm into a Private Limited Company?
Yes, you can convert your existing partnership firm into a Private Limited Company. The process involves compliance with certain legal formalities, such as obtaining DIN for partners, preparation of MOA and AOA and filing the necessary documents with the ROC.
Q26) What is the maximum number of shareholders allowed in a Private Limited Company?
A Private Limited Company can have a maximum of 200 shareholders. However, as private companies are mostly started by a small association of persons, they usually have a much lesser number of shareholders.
Final Thoughts
The process of company registration in India involves several considerations and the FAQs provided here serve as a valuable resource for entrepreneurs seeking to incorporate their businesses under the Companies Act of 2013. Registering as a Private Limited Company offers various advantages, such as limited liability protection and easy access to loans and contracts. The registration procedure can be conveniently completed online through SPICe Plus (SPICe+).
The required documents, including photographs and PAN cards of directors, are essential for the registration process. Compliance with ROC regulations, such as filing annual returns, is important to ensure smooth operations. Moreover, understanding the significance of MOA and AOA is vital, as these documents establish the foundation and internal guidelines for the company. As entrepreneurs start on their journey to establish their businesses in India, proper company registration and adherence to relevant laws and regulations will pave the way for a successful and legally compliant venture.
