Incorporation of Private limited company
Private Limited Company is basically a closely held Company which requires minimum two persons as Directors and shareholders for its incorporation. It is the most common and suitable form of entity for carrying out business in India with a long term objective. A Private Limited Companies in India are governed by the Companies Act, 2013. It has the advantage of limited liability, greater stability and recognition. The members are limited to 200. Recently, the Government of India came up with simplified procedures for incorporation of companies with zero fees of incorporation for companies up to authorised capital of Rs 10 Lakh. This revolutionary step placed India in the top 100 list of countries in ease of doing business.
Following are the steps for incorporation of private limited company
Reservation of name
The first and foremost step in the recently introduced simplified procedures is to apply for reservation of name through RUN services on MCA portal. Replacing INC 1, this form provides for two proposed names for the Company to be incorporated. Once the name applied is approved, it is reserved for the applicant for a period of 20 days from the date of approval, within this period one has to apply for the incorporation of Company, failing of which will lead to cancellation of the name granted by the Ministry.
Note: Recent notification by MCA permitted for one resubmission within 15 days for rectification of defects, if any which was not there when RUN Service was introduced. Earlier the name was either accepted or rejected. The Fee for this is Rs. 1000. DSC and DIN are not required for filing of RUN form.
Acquiring Digital Signature Certificate
Applicants who intend to be the Directors and/or subscribers to MOA of the Company shall acquire the Digital Signature Certificate (DSC) through MCA DSC Services.
Application for DIN
Director Identification Number (DIN) is a number allotted by the Ministry to the Individual for acting as a Director in the company. DIN is a unique number, and is mandatory requirement for a company for filing certain e Forms. To obtain DIN a person generally needs to apply in form DIR 3.
But if at the time of incorporation, a Director is not having DIN, then particulars of maximum 3 directors can be mentioned in form INC-32 (SPICE) and DIN may be allotted.
Application for Certificate of incorporation
1. Once the name is reserved for the proposed company, it shall proceed for making an application for Certificate of Incorporation in SPICe form (INC 32) accompanied with SPICe MOA(INC 33) and SPICe AOA(INC 34). Form SPICe (INC-32) mandatorily requires application for both PAN and TAN also.
2. The application is to be submitted by paying the requisite Stamp Duty as applicable in case of concerned state on the portal.
Note: Presently the companies with authorised capital less than or equal to Rs 10, 00,000 are exempted to pay fees.
3. Once the application is submitted, MCA21 system will auto generate the pre-filled application forms 49A (PAN) and 49B (TAN) after submission of SPICe, which the stakeholders are required to download, affix digital signature and then upload both signed forms on MCA21 system as linked forms.
Attachment to Spice form
a) Utility bill not older than 2 months (Bank statement, Electricity bill/ Telephone/Mobile bill)
b) NOC from the owner of the proposed registered office address of the Company;
c) Registered documents as a proof of ownership of registered office; OR
Notarized copy of lease or rent agreement in the name of the company along with a copy of rent paid receipt not older than one month
d) Consent to act as a Director of the company in form DIR – 2;
e) Declaration by first subscriber(s) and director(s) in form INC – 9 (duly franked and notarized);
f) If the subscriber is a non-individual, a copy of board resolution authorizing the person to act in its behalf;
g) Certified true copy of the self-attested Identity proof (PAN and Voter-id/Passport/Driving License) of the first subscriber(s) and director(s).
(Note: There is no requirement to attach the said documents if the applicants are already having DIN)
Obtaining certificate of Incorporation
After due verification of the application and documents provided, the concerned ROC may grant the Certificate of Incorporation (COI), which is a conclusive evidence of existence of the company, wherein the date of Incorporation, Company Identification Number (CIN) and Permanent Account Number (PAN) is mentioned with the sign and seal of the Registrar.
The Certificate of Incorporation is issued by the Registrar in Form No.INC-11
Once, the Certificate of Incorporation is granted, the company may commence the Business Activity as the incorporation procedure is completed.