What conditions must be met to register a private limited company in India?

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A Private Limited Company (Pvt Ltd Company) is India’s most popular business structure. It offers its shareholders the benefits of limited liability and has a separate legal entity from its owners. pvt ltd company registration in India requires fulfilling specific legal requirements set by the Companies Act, 2013. Let us discuss the requirements for registering a Private Limited Company in India.

Minimum requirements for registering a Pvt Ltd Company:

To register a Private Limited Company in India, the following minimum requirements need to be fulfilled:

  1. Directors: A minimum of two directors is required to register a Pvt Ltd Company. A resident of India must be at least one of the directors.
  2. Shareholders: At least two shareholders are required to register a Pvt Ltd Company.
  3. Capital: The minimum authorized and subscribed capital for registering a Pvt Ltd Company is Rs. 1 lakh.
  4. Registered Office: A registered office must be maintained in India.

Name reservation:

The first step in registering a Pvt Ltd Company is to reserve a name for the company. The name must be unique and not similar to any other registered company in India. The name can be reserved by filing Form SPICe+ or through the RUN (Reserve Unique Name) web service.

Digital Signature Certificate:

A Digital Signature Certificate (DSC) is required for all directors and shareholders of the company. The DSC is a digital signature used to sign the necessary e-forms for registration.

Director Identification Number:

All company directors must obtain a Director Identification Number (DIN) from the Ministry of Corporate Affairs. The DIN is a unique identification number for the company’s directors.

Memorandum of Association and Articles of Association:

The Memorandum of Association (MOA) and Articles of Association (AOA) are legal documents defining the company’s objectives and rules. The MOA and AOA must be drafted and filed with the Registrar of Companies.

Filing of Forms:

The next step is to file the required forms with the Registrar of Companies. The forms that need to be filed include the following:

  1. SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus) form
  2. Form DIR-3 (Director Identification Number)
  3. Form INC-9 (Affidavit and declaration by the first subscribers and directors)
  4. Form URC-1 (Application by a company for registration under section 366)

Payment of Fees:

Once the forms are filed, the registration fees must be paid online. The fees are based on the authorized capital of the company.

The legal requirements for a Pvt Ltd company to operate in India

Company Registration: 

The first step in starting an India private limited company is registering the company with the Registrar of Companies (ROC) under the Companies Act 2013. The company must obtain a Certificate of Incorporation from the ROC to commence its operations.

Permanent Account Number (PAN): 

The company needs to apply for a PAN with the Income Tax Department. It is a ten-digit alphanumeric number required for tax purposes.

Goods and Services Tax (GST) Registration: 

If the company’s annual turnover is expected to exceed Rs. 20 lakhs, it needs to register for GST with the GST department.

Income Tax Return Filing: A private limited company needs to file income tax returns every year by 30th September.

Board Meetings and Annual General Meeting (AGM):

 The company needs to hold board meetings and an AGM every year as per the Companies Act 2013.

Statutory Audit: A private limited company needs to conduct an annual audit of its accounts by a qualified Chartered Accountant.

Compliance Certificate: The company must obtain a compliance certificate annually from a practicing company secretary.

A private limited company needs to comply with various legal requirements to operate in India. These include company registration, MoA and AoA preparation, minimum share capital, DIN, PAN, GST registration, income tax return filing, board meetings, AGM, statutory audit, and compliance certificate. A private limited company can operate smoothly and avoid legal hassles by fulfilling these legal requirements.

The documents necessary for registering a Pvt Ltd company in India

Identity Proof:

 The directors of the company need to provide their identity proof, which can be any one of the following documents:

  1. a) PAN card
  2. b) Passport
  3. c) Voter ID card
  4. d) Driving license

Address Proof: 

The directors of the company need to provide their address proof, which can be any one of the following documents:

  1. a) Aadhaar card
  2. b) Passport
  3. c) Voter ID card
  4. d) Driving license
  5. e) Bank statement or utility bill (not older than two months)

Passport-size photograph: 

The company’s directors must provide their passport size photograph.

Registered Office Address Proof:

 The private limited company needs to provide proof of its registered office address, which can be any one of the following documents:

  1. a) Sale deed or property deed
  2. b) Rent agreement (if rented)
  3. c) Electricity bill or property tax receipt
  4. d) No objection certificate (NOC) from the landlord (if rented)

Form INC-9:

Form INC-9 is a declaration by each director and subscriber that they have not been convicted of any offense.

Form DIR-2:

Form DIR-2 is a declaration by each director that they have consented to be appointed as a company director.

Form INC-22: 

Form INC-22 declares that the company’s registered office address is correct and has obtained the necessary permission to use the address.

Long Does It Take to Register a Private Limited Company in India

The time required to register a private limited company in India can vary based on several factors, such as the completeness of the application, availability of necessary documents, and the workload of the Registrar of Companies (ROC) office. However, on average, it can take 15 to 25 working days to complete the registration process.

In conclusion, Registering a Pvt Ltd Company in India requires fulfilling specific legal requirements set by the Companies Act 2013. The requirements include the following:

  • Minimum directors and shareholders.
  • Minimum capital.
  • Registered office.
  • Name reservation.
  • Digital signature certificate.
  • Director identification number.
  • Memorandum of association and articles of association.
  • Filing of forms.
  • Payment of fees.
  • Certificate of incorporation.

By fulfilling these requirements, a Pvt Ltd Company can be registered in India and enjoy the benefits of limited liability and a separate legal entity.

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