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anand das (service)     31 May 2011

proprietary firm to pvt ltd company

1. A proprietor of a HR consulting firm wants to incorporate a pvt ltd company to give HR , recruitment services etc.  What is the procedure ?

2. What all licenses will be required ?

Pls guide.

Regards

anand



Learning

 5 Replies

VimalAnandan (Consultant)     01 June 2011

 

To start a Private Limited Company you need two directors and the minimum paid up capital should be Rs.1 Lakh.  I am giving below a rough Idea and steps which may helpful to you.

Please note that PVT Ltd company formation and related process involves online filing procedures with the use of digital signatures.  (This will be done through mca.gov.in website - ministry of corporate affairs, certificate of incorporation will be issued by the local ROC)

1) You need to obtain Director's Identification numbers for proposed directors and apply for a digital signature for authorized signatory.

2) Select a name for the company and apply for the availability with prescribed fees.

3) Once name availability is confirmed then you can..

4) Draft Memorandum and Articles of Association (This will explain the strategy of your business)

5) File the papers and documents along with payment of Fees

6) Obtain Certificate of Incorporation

Once you got your Incorporation Certificate you can proceed further:

First you have to apply for PAN Card for your company....

Once you got company PAN Card you can apply for Business Licences for your business 

According to your query... you need to register your company with Service Tax Authorities,  under Manpower recruitment services with your concerned Range Service Tax Commissionerate.  This process is also online.

 

52

Manpower Recruitment or Supply  Agency

07.07.1997

            00440060      

            00440061      

If you want to do Overseas Manpower Services... you have to apply with https://moia.gov.in/  and obtain specific registration.  For this you may require to give some Bank Guarantee etc.... Visit the ministry of overseas Indian Affairs for registration procedures and details.

Thanks

VimalAnandan
Chennai.

1 Like

anand das (service)     02 June 2011

Dear Mr Vimal,

Since the proprietary firm is already existing and it has some assets and liabilities. How it should be transfered to the pvt ltd company.  Will that require some sale deed or transfer/assignment deed ?

or can't the proprietary firm be closed so that all assets and liabilities become proprietor's ?. Then it becomes simple.

sanjay kumar (BE/ LLM in Corporate Laws)     02 June 2011

There is no problem, Mr Anand.

The formation of a Pvt Ltd company shall require Memorandum of Articles. The MOA of the Pvt Ltd company can include that the company will be taking over the assets and liabilities of the proprietorship concern.

For transfer of the properties, necessary govt regulations will have to be followed particularly for items like Vehicles, Land, Buildings which require registration with the government.

The pvt ltd company can either pay in cash to the proprietor of the firm or may issue shares to him in lieu of cash.  

1 Like

VimalAnandan (Consultant)     02 June 2011

Mr.Anand,

The newly started Pvt Ltd company is a different entity and the Proprietorship firm is a different entity.  So technically speaking you are just opend another new company wherein you are the director.  If you wish you can close the existing proprietorship firm and the P/L can be accounted to Proprietor's account.  Merging the company is also possible as explained by an expert.  If you want to keep the Proprietory firm for sometime for accounting reasons and finalizing accounts, thats also fine.  If you decided to keep the firm alive also is possible.  The difference between a Firm and a Company Limited by its share is this,  In a firm paper work and financial control can be made as per your wish, whereas, in a Pvt Ltd company you need some financial discipline.  Especially, drawing money from the company needs to be accounted properly.  Morevoer, paper work, board resolutions, director meetings., etc., etc.. all require proper attention.  Consult a Chartered accountant and plan well in advance.

1 Like

sheetal (proprietor)     27 March 2012

I have a proprietorship firm and a huf firm and i want to merge these two into a pvt. ltd. company.

Is this poosible. If yes please tell me how and please tell that what are the pros and cons of the both

thankyou


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