Private Limited Company Registration Process and Documents | Jordensky

Step by Step Private Limited Company Registration Process and Documents as per Companies Act, 2013 in India | Jordensky

Private Limited Company Registration Process and Documents | Jordensky

Step by Step Process for Incorporating a Private Limited Company in India

Startup founders prefer the Private Limited Company business structure the most. To ensure a successful incorporation, you should be aware of some dos and don'ts while setting up a private limited in India.

Under the Ministry of Corporate Affairs, Private Limited Companies are governed under the Companies Act, 2013. (MCA). The MCA has simplified the company registration process, making it easier to conduct business in India.

The Companies Act of 2019's Section 3(1) states that an organization can be established by:

  • If the company must be a public company, there must be seven or more people.
  • If the business must be a private company, two or more people
  • One person, if the business must be a one-person operation, i.e., a privately held business.

Step-By-Step Process of Company Incorporation Under Companies Act, 2013

Step 1: Obtain DIN for proposed directors

The Directors Identification Number, or DIN, has eight digits. Each candidate who is chosen to serve as a director of the company must submit an application in E-Form DIR 3 as per Section 153 of the Companies Act, 2013. However, the SPICe Form will be used to submit requests for the designation of DINs to the anticipated initial directors of new organizations.

A passport-sized photo, a copy of the applicant's PAN card, and a self-attested copy of their address proof are needed for DIN.

Step 2: Obtain DSCs

Digital Signature Certificates serve as a secure digital key that verifies the certificate holder's identity. A digital certificate can be used to sign papers electronically, access data or services online, and validate one's identity. The MCA has made it simple to register a corporation online, thus each subscriber's DSC is necessary. The e-MoA and e-AoA must both have the subscribers' and witnesses' digital signatures.

 Identification evidence, a PAN card, proof of address, and attesting officer proof are essential documentation for DSC.

Step 3:Verify Company’s Name Availability

Using the linked link, confirm that the organization's chosen name is present on the MCA website.

The RUN webservice also allows the planned name of the organization to be stored. For booking a name for a new organization or changing the name of any existing organization, RUN (Reserve Unique Name) is an easy-to-use web administration. In addition, the applicant must submit an RUN application along with payment of the applicable fees to reserve the desired organization name, which will then be handled by the Central Registration Center (CRC).

Step 4: Draft MoA & AoA of the firm

In addition, the proposed name of the organization may be Memorandum of Association (MoA),which refers to the company's founding document. A corporation's connection with shareholders is outlined in this formally approved document, which was created during the creation and registration procedure. It also outlines the purposes for why the company was established.

The internal management of a firm is outlined in the Articles of Association (AoA). It specifies the responsibilities, privileges, and authority of the company's management. Similar to that, it is a legally recognised document created as part of an organization's formation and registration process to characterize its relationship with investors and to specify the goals for which the firm has been established.

 Step 5: File SPICe Form – INC 32

The SPICe Form (INC-32) is used for single applications for name reservations, new company incorporations, DIN allocation applications, PAN applications, and TAN applications. Additionally, this e-Form is accompanied by supporting documents like a MoA and AoA, a list of the Directors and Subscribers, etc.

The firm will be registered and its CIN assigned once the e-Form has been reviewed and deemed complete. Additionally, potential directors who don't already have a valid DIN are provided one. Additionally, three directors are permitted to submit applications for the allocation of DIN using this integrated form when forming a firm. Additionally, the company would be awarded a PAN and TAN.

 The SPICe Form must be submitted to the Registrar of Companies with the following supporting documentation:

  • Form DIR-2 –statement from first directors
  • Statement by Directors- regarding credits
  • DIN affirmation by proposed directors
  • INC-9affirmation by first subscribers and directors
  • Directors’ interest
  • Memorandum of Association (can be recorded as e-MoA in Form INC 33)
  • Articles ofAssociation (can be recorded as e-AoA in Form INC 34)
  • Statement by the director if any agreement of sector regulator is required
  • Registered office address proof
  • Proof of address and identity of all the subscribers

Step 6: File form INC 35 or form AGILE with RoC for GST, ESIC and EPFO registration in one go.

Application for a GST number, ESI and EPF registration, and Employees Provident Fund (EPF)registration are made using Form AGILE. Similarly, startups can apply for a GSTIN, an Establishment Code supplied by EPFO, or an Employer Code provided by ESIC through an e-form if they want to register their businesses with SPICe(INC-35).

Companies that were incorporated under the MCA using the SPICe application can use this procedure. Similar to this, various application categories for GSTIN (such as Tax Collectors, Tax Deductors, Casual Taxable Individuals, ISDs, and so forth)should continue with the current process of signing up through the shared platform for GST registration.

To apply for a GSTIN, Establishment code, or Employer code at the time of organizational consolidation is optional, though.

Post-Incorporation Procedures

Step 7: Authentication of Registered Office in INC 22 Form

Within 30 days of incorporation, companies are required under Section 12 of the Companies Act of 2013 to provide the Registrar of Companies with their registered office address. Moreover, the confirmation of the enlisted office must be documented in form No. INC.22 together with the requisite expenses asper Rule 25 of the Companies Incorporation Rules, 2014.

Along with the supporting documentation, the Form INC 22 must be filed with the:

A registration document listing the addresses of the company's registered offices;

  • A copy of the most recent month's rent payment receipt and a notarized copy of the rent or lease agreement in the company's name;
  • Likewise, permission from the owner or authorized occupant of the premises is required in addition to proof of occupancy or tenancy consent for the company to use the property as its registered office;
  • Additionally, the most recent two months' worth of utility service verification, such as a proof of residence for the location shown on the document or the owner's identity, is required.

Step 8: Requirement of Company Name Board & Official Publications

According to Section 12(3), the Companies Act, 2019, each organization shall hold

  • Company’s name, and
  • The address of the company’s registered workplace.

Additionally, have a copy of the equivalent available at the entrance to the location where its commercial operations are conducted. It should be displayed there in prominent location with legible lettering in both English and the local dialect of the area in question.

In all business letters, letterheads, billheads, notifications, and other official publications, the organization must have its firm name, registered office address, Corporate Identity Number, phone number, email address, fax number (if any), and website address (if any) printed.

Step 9: Declaration to be Documented by the Directors within 180 days

According to Section 10A of the Companies Act of 2013, a company with a capital share that was formed after the start of the Companies (Amendment) Ordinance, 2019 is not permitted to launch a business or exercise any authority unless:

Within 180days of the company's incorporation, a director notifies the Registrar that each subscriber to the memorandum has granted permission for their shares to be acquired by them as of the creation date of such a statement. This declaration is confirmed in INC 20A Form along with any fees that may be agreed upon.

Additionally ,the organization submitted an INC 22 Form to the Registrar in order to certify its registered business status (which we have just discussed in Step 7).

Step 10: Selection of Auditor

Each organization must appoint an individual or a firm as an auditor at its first annual general meeting, who will maintain the position from the conclusion of that meeting until the conclusion of its sixth annual general meeting, as required by Section 139(1) of the Companies Act, 2013.

An organization can be successfully incorporated and founded by taking the processes outlined above. Similar to this, the organization achieves the status of a distinct legitimate body following incorporation.

About Jordensky

At Jordensky, we specialize in accounting, taxes, MIS, and CFO services for Startups and growing business and are focused on delivering an experience of unparalleled quality.

When you work with Jordensky, you get a team of finance experts who take the finance work off your plate – ”so you can focus on your business.”

FAQ's on Private Limited Incorporation in India

Que - What advantages do Private Limited Companies have in India?

Ans - A few benefits of a private limited business are as follows:

  • The danger to personal assets in Pvt.Ltd. is minimal.
  • It is a Separate Legal Entity,
  • Members would have Limited Liability in a Private Limited Company.
  • A shareholder may transfer their shares of a corporation limited by shares to anyone else. Compared to the transfer of an interest in a company operated as a proprietary concern or partnership, the transfer is simple.
  • A firm, being an autonomous legal body, can sue and be sued in its own name, just as one individual may bring a legal action in his or her own name against another in that person's name.
  • There is no longer a requirement for a private company's share capital to be at least Rs. 1,00,000 as there formerly was. As a result, there is no pressure to raise funds.
    A private limited corporation can easily obtain money by transferring shares.

Que - What is the Pvt. Ltd. Company's minimum turnover and capital need in India?

Ans - In contrast to a one person company, a private limited company has no restrictions on capital or turnover.

Que - What is the tax rate for a Private Limited Company?

Ans - A tax rate of 30% of total income is applied to private limited enterprises having a previous-year total turnover of less than 400 crores.

Private limited company that had a total annual revenue of > 400 crores are subject to a 25% income tax.

A private limited corporation is also required to pay income tax surcharge, education cess, and secondary and higher education cess in addition to regular income tax.

Also, read about

Conversion Partnership firm into Private Limited.

Conversion of Private limited into LLP

Conversion of OPC into Private limited Company