Incorporation of a limited company means declaring a corporate entity separate from its owners. It is a legal process and the second step towards the formation of a company. The first step to form a company is promotion which is followed by incorporation. It is the process of getting your company incorporated with the registrar of the company by filing various documents such as a memorandum of association, articles of association etc. Its major advantage is it protects the owner’s interest in the liabilities of the company.
Private Limited Company
Shareholders are those who purchase shares of the company and play a major role in the affairs of the company. A minimum number of two shareholders are required for Private limited company registration whereas its maximum limit goes up to 200 shareholders.
For incorporating a private limited company a minimum number of 2 and a maximum number of 15 directors are required. Any person who has attained the age of 18 years or more can become a director of the company. However, there is no limitation over the residential status of a person. Every director is given a director identification number which never expires.
The time duration for incorporating a company
You can get Private limited company registration in India within two to six weeks. Basically, the process for incorporation depends on document submission and government approval. If you want to have a quick registration then make sure you choose a different and unique name for your company and that you have all the documents which are required.
- Obtain digital signature: -A company before incorporation must apply for digital signature. A digital signature is required to copy all the documents and certificate. Therefore it required by every direction to have a digital signature.
- Obtain director identification number: Under sec 159 of the companies act it is required for every director to obtain an identification number from central government. Therefore before submitting the documents for incorporation, every director should have DIN. If any director doesn’t have DIN they cannot apply for incorporation.
- Name approval: Every company must think of a unique name for its company. Every company has to submit the list of 5-6 names in accordance with the preference to ROC i.e. registrar of the company. If the ROC is satisfied with the name then you will receive a name approval letter. The applicant cannot start working or enter into an agreement until he/she receive a letter of name approval from the ROC.
- Preparation of MOA and AOA: Memorandum of association and articles of association must be prepared by the company. MOA is a document containing the objective and powers of the company. AOA is a document containing the rules and regulations for the internal management of the company. These two documents are very important to prepare as they are the charter and rules and regulations of the company.
- Application for the incorporation: After completing all the above-mentioned steps you can file an application for incorporation of the company. The application should be filed with the registrar of the company with form 7 and form 22. Form 7 is a detailed statement about company’s memorandum of association and articles of association. Proof of residential address, proof of identity, NOC if there is the change in promoters, pan card should also be attached with the application.
- Receiving the certificate: If after the filing of all the above documents the registrar is satisfied with all the documents then he will issue a certificate of incorporation in form 11. After receiving this certificate the company can move to other steps in formation of the company