Private Limited Company Registration in India

PRIVATE LIMITED Company Registration www.enterslice.com

INTRODUCTION Private Limited Company, is the best corporate structure to start your own business. It is the most common vehicle to carry on business for an entity intending to make a profit & enjoy the benefits of an incorporated entity, particularly limited liability.

According to section 2 ( 68 ) of companies act 2013, Private company means a company which is not a public company & which restricts the right to transfer its shares & which prohibits any invitation to the public to subscribe the securities of the company. It can be registered with minimum two members and maximum with two hundred members.

CHARACTERISTICS OF PRIVATE LIMITED • MEMBERS – To start a company, a minimum number of 2 members are required & maximum 200 members as per the provisions of Companies Act , 2013 • LIMITED LIABILITY - The liability of each member is limited or shareholders is limited.

• DIRECTORS- Minimum 2 directors is required • PERPETUAL SUCCESSION- The company will continue even in the case of death , insolvency & bankruptcy of any of its members.

CONT…..

• NAME – It is mandatory for all the private companies to use the word Private Limited after its name.

• MINIMUM SUBSCRIPTION- Private limited company shares can be allotted to the public without receiving the minimum subscription.

ADVANTAGES OF PRIVATE LIMITED • Limited Liability Liability of Members and Directors of the private limited company is limited to their shares.

• Brand Value Company’s brand value will get increased because employees feel secure in joining the private limited company.

• Continuity of Existence The life of a business is not affected by the status of shareholders and even after the death of the shareholder, the private limited company continues to exist.

CONT……

• The Scope of Expansion The Scope of expansion is higher because easy to raise capital from a venture capitalist, angel investor, financial institutions and the advantage of limited liability. The private limited offer more transparency in the company.

• Capacity to sue & be sued A company being an independent legal entity can sue & also be sued in its own name.

DOCUMENTS REQUIRED FOR REGISTRATION • For Director & Shareholders • • • •

Pan Card Identity Proof ( Voter ID / Aadhar Card / Passport / Driving License ) Passport Photo Address Proof ( Bank Statement / Mobile bill / Telephone ) Last 2 months

• For Registered Office • • • •

Rent Agreement ( Notarised )- If it is rented Property Property ( Director / Relative ) – Registry Proof / House tax receipt Any Utility Bill in the name of Owner NOC from the owner

REGISTRATION PROCESS 1. DSC (Digital Signature Certificate) All Propose directors of the private limited Company should have a digital signature and digital signature will use to file the registration, ROC compliance forms, and Tax returns.

2. Director Identification No (DIN) When a Digital signature is approved, and you will get an approval email from the Registrar of companies that you are now eligible to be a director of a company. It takes one working days to approve DIN. Obtain DIN for the proposed Director in Form DIR -3

3. Company Name Approval After a Trademark search, we will proceed to file a Name approval application to ROC . Select Suitable name of Company & make application to the MCA for availability of name in Form INC -1.

4. MOA & AOA is to filed Electronically according to Spice version.

5. After Name approval , Form Spice INC -32 is to be filed within 60 days of filling INC-1 for getting the Certificate of Incorporation.

6. All the Documents related to registered office will filed in Spice INC-32 7. PAN & TAN of the company will filed in Spice INC -32

COMPLIANCES There are some compliances which are mandatory in every Private Limited Company 1. Board Meetings At least 4 board meetings need to held in a year & at least 1 meeting needs to be held every quarter.

2. Annual General Meeting For approval of financial statements , declaration of dividends, appointment of auditors etc. is the primary agenda for this meeting.

3. Maintenance of statutory register & Minutes book A number of registers are required to be maintained such as register of member , directors etc.

CONT……

Event Based Compliances : • Appointment of directors • Allotment of shares • Transfer of shares • Resignation of directors • Change in the Bank signatories • Receipt of share application money • Change in the statutory auditors

MANDATORY COMPLIANCES AFTER INCORPORATION 1. Appointment of Auditor Within 30 days of registration of company , the board of directors of the company must call a board meeting & appoint an auditor of the company. The tenure of the auditor so appointed is to be till the conclusion of the first annual general meeting.

2. Disclosure of Director’s Interest & Declaration regarding disqualification The Board of Directors of the company to hold the meeting within 30 days of registration & the directors of the company will be required to disclose their concern or interest in other companies or body corporate declare that directors are not disqualified .

CONT‌..

3. Registered Office On & from the 15th day of its incorporation & at all the times thereafter, the company is required to have a registered office capable of receiving & acknowledging communication & notices.

4. Issue of share Certificates to Subscribers Within a period of 2 months from the date of incorporation , every company must deliver a share certificates to the subscribers of the memorandum.

ANNUAL FILLING FORMS MBP-1 – Every director of the company in first meeting of the board of directors in each financial year will disclose his interest in other entities.

DIR – 8- Every director of the company in each financial year will file with the company disclosure his Non- disqualification.

MGT- 7- Every company shall file its annual return within 60 days of holding of AGM. AOC-4 – The company required to file its balance sheet along with statement of Profit & Loss account & directors report in this form. Attachments required :

CONT‌.

Balance sheet , statement of P & L account , Directors Report , Auditors Report & Notice of AGM. ADT- 1- Auditor will be appointed for the 5 year & form ADT-1 is to be filed.

LEGAL COMPLIANCES AS PER INCOME TAX ACT Every company registered in India are required to file their Income Tax Return in ITR6 on or before 30th September of the following financial year to the financial year for which such returns to be filled.

If such company annual turnover of Rs. 1 Crore or more than 1 crore during the financial year then they compulsorily required to get their accounts audited under section 44AB of the Income Tax Act. Such audits are required to be conducted by Chartered Accountant.

Company Statutory auditor as appointed under Companies Act,2013 can also be appointed as Income Tax Auditor under Section 44AB .

REASONS TO OPT PRIVATE LIMITED COMPANY 1. Improve Business Credibility In Private Limited Company , the information relating to the company, such as name of the company , date of incorporation, & other information are made available in a publicly searchable database. This feature make it easy to authenticate the existence of the business.

2. Exit Plan Private Limited companies offer the best type of strategy for all promoters.

3. Going International Private Limited Companies allow FDI through the automatic route.

4. Give Multiple Opportunities It will allow the promoter to pursue multiple opportunities .

5. Limit the risk to personal assets.

Thank You www.enterslice.com