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info@satkritiadvisors.in
A private limited company, in essence, constitutes a business structure owned by a collective of individuals or shareholders. At Satkriti Advisors, we offer specialized assistance for private limited company registration in India, ensuring a seamless process for our clients
Explore private limited company registration intricacies, assess pros and cons, and receive expert guidance for informed decisions.
A Private Limited Company, as per the Companies Act of 2013, is privately owned by shareholders, not listed on the stock exchange, and prioritises shareholder interests.
In India, a private limited company is a privately held entity with limited liability, and it ranks among the nation's most favored business structures. This popularity is primarily attributed to its numerous advantages, including limited liability protection, ease of formation and maintenance, and its status as a distinct legal entity.
In India, a private limited company requires a minimum of 2 Directors and 2 Shareholders, with at least one Director being an Indian resident.
✅︎ Limited Liability: Shareholders' responsibility is restricted to the extent of their capital contribution, safeguarding their personal assets from the company's financial obligations and liabilities.
✅︎ Distinct Legal Identity: A Private Limited Company possesses an independent legal identity distinct from its proprietors. It has the capacity to own assets, engage in contractual agreements, and initiate or defend legal actions under its own name.
✅︎ No Minimum Paid-up Capital: After the amendment of the Companies Act, 2013, private limited companies do not require a minimum paid-up capital. It can be registered with a nominal amount of Rs. 1,00,000 as authorised share capital. Authorised Capital is the maximum amount of share capital that a company is allowed to issue to its shareholders as per its constitutional documents.
✅︎ Continuous Existence: The company's existence persists irrespective of shifts in shareholders or directors.
✅︎ Ease of Funding: Raising capital by issuing shares to investors, venture capitalists, or angel investors is easier. This structure attracts external investment.
✅︎ Tax Benefits: Private Limited Companies may qualify for various tax benefits and exemptions from time-to-time, making them tax-efficient entities.
✅︎ Credibility and Trust: Having "Pvt. Ltd." in your company name often instills more confidence and trust in customers, suppliers, and partners giving your entity a premium identity.
Company Limited by Shares:
✅︎ Shareholders' liability limited to nominal share amount in Memorandum of Association.
Company Limited by Guarantee:
✅︎ Member liability limited to the amount of guarantee specified in Memorandum of Association.
✅︎ Guarantee invoked only during winding up.
Unlimited Companies:
✅︎ Members have unlimited personal liability for the company's debts and liabilities.
✅︎ Still considered a separate legal entity; individual members cannot be sued.
✅︎ Compliance Burden: A Private Limited Company is obligated to lot of compliances, face regulatory demands, including financial reporting, filings, and audits.
✅︎ Complex Setup: Process and cost for managing are higher than more superficial structures.
✅︎ Number of members: The members of a private limited company are limited. It can only have a maximum of 200 members, while a public limited company can have unlimited members.
✅︎ Restriction on transfer of shares: In a private limited company, the transfer of shares is not allowed under its AOA, and these shares cannot be listed on the stock exchanges.
✅︎ Exit Complexity: Selling or leaving is more complicated than with other structures.
✅︎ Slower Decisions: The involvement of shareholders and directors may slow down the decision making process.
For online company registration of Private Limited Company in India, certain essentials must be fulfilled, including the requirements for directors and shareholders and also the necessary documents.
| Requirements | Particulars |
|---|---|
| Shareholders | Minimum of 2 shareholders |
| Directors | Minimum of 2 directors, maximum of 15 directors. At least one director must be a resident of India |
| Shareholder/Director Overlap | The same person can act as both a shareholder and a director |
| DirectorIdentification Number (DIN) | All directors must obtain a Director Identification Number (DIN) |
| Digital Signature Certificate (DSC) | All directors must possess a Digital Signature Certificate (DSC) |
Registering a company in India involves a straightforward four-step process:
Every director and shareholder must secure a Digital Signature Certificate (DSC).
Obtain a Director Identification Number (DIN) if you intend to be a director in the company. DIN is essential for directors and needs to be provided in the registration form.
Begin by securing a unique name for your company.
Provide comprehensive information concerning the company proposed to be incorporated. This includes PAN, TAN registrations as well.
Draft Memorandum of Association (MOA) and Articles of Association (AOA) containing crucial company details shall be prepared and submitted. Additionally, AGILE-PRO form will also be submitted which shall include EPFO, ESIC registrations.
Upon successful document verification, the MCA will issue the Certificate of Incorporation (COI) with the Company Identification Number (CIN), PAN, and TAN and Registered office address of the Company.
| Post Incorporation Compliances | Due Dates |
|---|---|
| Convene First Board Meeting | Within 30 days from Incorporation |
| First Auditor Appointment | |
| Professional Tax Registration, if applicable | |
| Opening a Bank Account | |
| Collect Entire Subscribed Capital | Within 60 days from Incorporation |
| Issue Share Certificates | |
| File INC-20A | Within 180 days from Incorporation |
| GST Registration | No Prescribed Due Date |
| MSME Registration | |
| Startup India Recognition | |
| Industry Specific License | |
| IPR / Trademark Registration | |
| Import Export Code, if applicable | |
| Disclosing Director’s Interests |
A Private Limited Company registration provides a structured and secure business setup for entrepreneurs looking to start and grow their ventures. While forming a Private limited company, certain requirements and compliances must be adhered to in order to make the incorporation and its functioning more effective.
We at Satkriti Advisors can help you with all requirements from providing advice in the initial phase to ensuring that you meet all the necessary requirements, while also keeping your company in perfect legal standing.
Our services include the following:
✅ Digital Signature Certificate (DSC) Services.
✅ Eligibility Assessment and Guidance.
✅ Uploading the documents in MCA portal and Submission along with standard fees.
✅ Post-registration compliance support for private limited companies.