Tarun Aggarwal 11 July 2025

Do i need a lawyer for custom contracts or esops in a private limited company?

I'm in the process of registering a private limited company and planning to onboard a couple of key team members with equity-based compensation. I’ve heard about ESOPs and also need to create some custom service agreements with vendors.

My questions are:

Is it legally mandatory to hire a lawyer for issuing ESOPs in a private limited company?
Can custom contracts and employment agreements be drafted without legal help?
Are there any MCA compliance filings or formats required for ESOP implementation?

Also, I'm using Taxlegit for Private Limited Company registration and they’ve been helpful, but I want to know what part needs actual legal opinion versus what can be handled by a compliance consultant.

Would appreciate insights from company law experts or anyone who has issued ESOPs in early-stage startups.

Thanks in advance!

Reply Follow

2 Replies

T. Kalaiselvan, Advocate (Advocate) 11 July 2025

It is not mandatory to engage the services of a lawyer for this purpose, you can enggage the services of a company secretary too.

If you are aware of the legal issues involved in the drafting of agreement then you can very well proceed with your own knowledge.

A company, including a private company, is not required to obtain prior permission from the Ministry of Corporate Affairs (MCA) to issue Employee Stock Options (ESOPs). However, they must comply with the requirements of the Companies Act, 2013, including obtaining shareholder approval through a special resolution and making necessary disclosures.

On all practical issues you can consult an experienced consultant in the local