A private limited company is the most common form of business entity in India. It is easy to maintain and raise funds, offers limited liability to its members, offers flexibility, easy bank loan accessibility. Registration procedure of Private Limited Company is a little bit complex but can be done by following these simple steps mentioned below.
- There must be at least 2 members in the company.
- The company shall be made for legal business and must not harm the society. The company object should not be illegal.
- In case, if the registrar issue the certificate of incorporation to such business entity, then certificate will be void and registration will be itself canceled by the Central Government and appropriate proceeding will take place against the entity and the Registrar.
Step 1: Obtaining Director Identification Number (DIN) & Digital Signature
- Obtaining Director Identification Number (DIN) for the proposed Directors in the Company
- Obtaining Digital Signature for one of the Directors of Company.
After this, application for the name of Private Limited Company must be applied.
Step 2: Applying for the name
The promoters should propose one or more suitable name for the name of company as it offers the flexibility and choice to Registrar to select the name in case some names are identical or similar to registered business entities or trademark
- The name should not be similar or identical to any registered company or trademark.
- The name should not be one prohibited under the ‘Emblems and names Act, 1950’.
- The name of the company must have suffix “Private Limited Company “.
After submission of name, the registrar will review and approve one of the names. It usually takes 3 to 5 working days to approve the name for the company and registration procedure.
Step 3: Filing for Incorporation of Private Limited Company
After the name approval, promoters should submit the application, prescribed fees and below said following documents to the registrar:
- Articles of Association;
- Memorandum of Association;
- Declaration from Directors;
- Affidavits of the Directors.
A declaration stating that the requirements of the Act and the rules framed thereunder have been compiled with. This declaration is required to be signed by an advocate of the or Supreme Court or an attorney or a pleader having the right to appear before or a High Court or a Chartered Accountant in whole time practice in India who is engaged in the formation of a company, or by a person named in the Articles as a Director, Manager or Secretary of the Company.
Besides the aforementioned documents, the company must provide relevant information regarding of its registered office within 15 days of registration or during filing of incorporation documents.
Step 4: Subscribing to the Private Limited Company
As per the Companies Act 2013, a subscriber must sign their names and must be subscribed to the shares of the company incorporated. It means each subscriber must have at least one share of the company. Each subscriber should sign the memorandum in presence of at least one witness and must clearly state the following:
- Personal Description
- No of shares subscribed
- Nature of shares etc.
Likewise both (Article and Memorandum of association) must be duly signed and stamped.
Step 5: Certificate of Incorporation
After filing the above-mentioned documents and payment of necessary fees, the certificate of Company incorporation would be issued by the Registrar of Companies. Upon Incorporation, the company becomes a legal person separate from its members.
The process to register a private limited is complex and time-consuming. Our team at LegalRaasta can help startups and Entrepreneurs to Register Private Limited Company.