WHAT IS COMPANY?
A company is a kind of business structure or a business organization. The company has been evolved from sole proprietorship business structure to partnership type of business and after that the company type of business structure came up.
In case of companies money can be raised from many people all over the world in the form of capital to the company. In company the capital that we can raise is unlimited and in company each member liability is limited to the share invested.
A company is an artificial person, created by legal incorporation having separate legal entity, perpetual succession and common seal that represent the company as a whole as a person itself.
A company is the voluntary association of the person and must be incorporated under companies Act 1956 or companies Act 2013.
TYPES OF COMPANY
ON THE BASIS OF INCORPORATION
- Charter Company
- Statutory Company
- Registered Company
ON THE BASIS OF LIABILITY
- Limited Liability Companies
- Unlimited Liability Companies
ON THE BASIS OF TRANSFERABLITY OF SHARE
- Private Company
- Public Company
Private company is owned by a private individual to run the company and in private company which has minimum membership of 2 people and maximum member of 200 people (Sec 68 sub clause (ii)). According to section 68 of Companies Act 2013 Minimum paid up capital is 1 lakh to start the company.
There is restriction on transfer of share which means if 20 people who have formed the private company these members can be the member only and cannot transfer their ownership without the consent of all the members. In private company word ltd (limited) is essential to be used.
Best example of the private limited is Flipkart online services private ltd.
THINGS ONE MUST KNOW ABOUT REGISTRATION OF THE PRIVATE LIMITED COMPANY
- Time required for the complete process
- How much cost one has to bare
- What is the complete process
Time required for the complete process
The entire process is quite simple now-a-days as the whole process for formation of a private limited company is online and it generally takes near about twenty to thirty days for the entire process for its completion
In several cities this process takes one week for its completion but in some it takes quite long for the completion of the process.
How much cost one has to bear?
For the registration, it generally takes near about 15000 rupees for its complete registration of the private limited company.
What is the complete process?
There are three simple steps that that private limited company must follow in order to get registered.
- DIN Number
- Name Approval
- Registered address proof
~ Memorandum of understanding
~ Article of association
The first step towards registration of Private Limited Company is DIN NUMBER which stand for Director Identification Number for the formation of the private limited company which requires minimum two director to start a private limited company and each director has give their DIN NUMBER.
For the acquisition of a DIN number one must give the following document which is required by the director to get DIN number are:-
- Copy of a PAN Card of each director
- Address proof of each director (which could be a copy of a Adhar card , Voter ID, Driving License or pass port)
- Pass port size photograph of each of the director.
After these thing will be submitted than each director will allotted there DIN number. Than we can say that the first step towards the registration of private limited company is completed.
COMPANY NAME APPROVAL
For the name approval one must have to think about the name of the company before setting up of a company.
The Ministry of Corporate Affair has laid down the certain guidelines regarding the setting up of the company name and ever company has to follow these guidelines for getting approval of the name some of those guidelines are:-
The company name should be divided into two part i.e.
- Unique Name:- Unique name is the special name which the company has to keen according to their preference
- Nature of work:- Second name must be that which itself signify the nature of the work
For example:- Madam Matching Private Limited it one of the company first word “madam” is a unique name and “matching” signifies that in this company matching work of the cloths take place.
- Tata Motor Private limited
- Reliance Communication Private Limited.
PROVE OF REGISTERED OFFICE ADDRESS
Before setting up of the company one is aware of the fact that where they want to set up there company i.e. area, locality etc. thus they identify the same. So it will have the address of it which needs to be submitted.
That address is that which is going to be printed on the copy of the certificate of incorporation which will serve as the company headquarters of the particular company.
This address could be yours Home address, any property that you own or any rented property.
In case of rented property one has to submit its rental agreement copy which would be signed at the time of acquiring that property and along with it No objection Letter from the owner of that property which clearly show that the owner has no problem with the trade you are carrying out.
If the property that you have purchase than too you have to give your electricity bill of the owner of the property and no objection letter of the owner. In certain cities they ask for the property document such sale deed etc.
Along with this registered address proof one has to submit two more things i.e. MoU and AoA. MoU stand for memorandum of understanding is a formal agreement between two or more parties. Companies can establish this formal relation between the directors of the company. AoA stand for a company’s articles of association is a document which, along with the memorandum of association defines the responsibilities of the directors, tells the kind of business they will continue, and the means by which the shareholders exert control over the board of directors. They basically tell the purpose for which the company has been established.
Author: This blog is written by Mr. Aman Verma, student of Bharati Vidyapeeth Deemed University New Law College, Pune, a passionate blogger & intern at Aapka Consultant.