Steps to setup a PVT LTD company
Company Formation in India is not tough when you have the best consultants by your side. with our guided expertise and you will see that you do not need to worry about a thing. So, go ahead for Formation of Private Limited Company Formation in India without having to worry about a thing.
Persons desirous of forming a company must adhere to the step by step procedure as discussed below:-
- Apply for Directors Identification Number and Digital Signatures.
- Selection of type of the company.
- Selection of name for the proposed company.
- Drafting of Memorandum and Articles of Association.
- Stamping, digitally signing and e-filing of various documents with the Registrar.
- Payment of Fees.
- Obtaining Certificate of Incorporation.
- Preparation and filing of Prospectus/Statement in lieu of Prospectus and e-Form 19/20 (in case of public companies) for obtaining the certificate of commencement of business.
- Obtaining Certificate of Commencement of business (in case of public limited companies).
Obtain Digital Signatures
Selection of name
Six names are requ1ired to be selected in order of preference after taking notes of numerous provisions, clarifications, circulars and rules made by the Ministry of Corporate Affairs, etc. In case key word is required, significance of each key word should be given in the e-Form 1A.
a) Applying for ascertaining the availability of the selected name
The promoters are required to make an application to the concerned Registrar of Companies to be submitted electronically to the Ministry of Corporate Affairs on the portal of MCA. An application shall be in e-Form INC-1 as per sec 4(4) read with Rule 9 of Companies (Incorporation) Rules, 2014, duly digitally signed by any one promoter or managing director or director or manager or secretary of the company along with the required fee for ascertaining whether the selected name is available for adoption by the promoters of the proposed company. MCA has prescribed certain rules for name availability so it is advisable to check guidelines for the same before applying for name. Refer Rule-8 of Companies (Incorporation) Rules, 2014.
b) Approval of the name
After receipt of completed application in e-Form INC-1, the Registrar shall intimate whether the proposed name is available for adoption or not. As per section 4(5), maximum time for which name will be available has been prescribed in the law itself under section 4(5). The name will be valid for a period of 60 Days from the date on which the application for Reservation was made.
Note: The applicant cannot start business or enter into any agreement, contract, etc. in the name of the proposed company until and unless a certificate of registration is issued by the registrar of companies as per the provisions of the Companies Act, 2013 and the rules made there under.Requirement for having DIN
Preparation of the Memorandum of Association (MOA) and Articles of Association (AOA)
Nowadays various document prescribed under the Companies Act, 2013, are required to be filed with the digital signature of the Managing Director or Director or Manager or Secretary of the Company, therefore, it is compulsorily required to Obtain a Digital Signature Certificate from authorized DSC issuing authority for at least one director to sign the E-forms related to incorporate like form INC.1 and other documents.
Selection of the type of company
The Promoters of a company may be individual entrepreneurs or body corporate engaged in efforts to incorporate a company. They have the power of defining the object of the company and deciding various matters for the company proposed to be incorporated. It is depending upon, the purposes for which the company is to be incorporated, proposed scale of operations, capital involved, etc. The promoters can select type of the company as they wish to form themselves into viz. private company, public company, non-profit making company, etc.
Obtain Director Identification Number [Section 153]
As per 153 of the Companies Act, 2013, every individual intending to be appointed as director of a company shall make an application for allotment of Director Identification Number in form DIR.3 to the Central Government in such form and manner and along with such fees as may be prescribed.
Therefore, before submission of e-Form INC.1 for availability of name, all the directors of the proposed company must ensure that they are having DIN and if they are not having DIN, it should be first obtained. Specific care should be taken that a person cannot have more than one DIN, therefore, a DIN once obtained shall serve the requirement for all the companies in which he is a director or intended to be a director.
Drafting of the MOA and AOA is generally a step subsequent to the availability of name made by the Registrar. It should be noted that the main objects should match with the objects shown in e- Form INC-1. These two documents are basically the charter and internal rules and regulations of the company. Therefore, it must be drafted with utmost care and with the advice of the experts and the other object clause should be drafted in a very broader sense.
As per section 4(6) the memorandum of a company shall be in respective forms specified in Tables A, B, C, D and E in Schedule I as may be applicable to such company.
As per section 5(6) the articles of a company shall be in respective forms specified in Tables F, G, H, I and J in Schedule I as may be applicable to such company.
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