Private Limited Company

Private Limited Company (Pvt. Ltd.) is one of the most common type of company or legal entity formed in India. A Private Limited Company provides a good balance between limiting liability of owners/ shareholders and retaining control by entrepreneurs (shareholders) in the administration of the business, including transfer and succession. The operational and business functions of the company are carried out by the directors, who can be shareholders themselves, with various managers, employees and other staff to support them. Compliance requirements are less compared to the Public Limited Company, however, books of accounts have to be prepared and maintained and have to be audited. Major drawback of a Private Limited Company is the restriction on transferability of shares, particularly through listing in a stock exchange, etc. and cap on the number of members to 50. If a company wants to overcome these restrictions, say in the process of business expansion company is looking for infusion of capital through sale of shares to public at large, then they can consider converting their company to a Public Limited Company. A Public Limited Company is not bound by the restrictions of a Private Limited Company, but has to comply with a lot of other requirements, including disclosures.

Private limited company registration is governed by the Companies Act, 2013 and the Companies Incorporation Rules, 2014, and is handled by the Ministry of Corporate Affairs through Registrar of Companies. The requirements for formation of Private Limited Company are:

1) a minimum of two shareholders, either or both of whom can be another corporate legal entity, including foreign entity

2) a minimum of two Directors (natural person)

3) an Indian office address

What Is The Process?


  • Check availability of proposed company name and select up to six names in order of preference
  • Once the proposed name is approved or is available, apply for company registration within 60 days of the name approval
  • Digital Signature Certificate (DSC) will be required for form submission; it is advisable to obtain DSC if one is not available
  • Director Identification Number (DIN) is mandatory for all directors; it is advisable to obtain DIN if a director does not have one
  • Information and documents required are
    • Suitably drafted Memorandum of Association (MOA) and Articles of Association, duly stamped with payment of stamp duty and signed by at least two subscribers, witnessed by at least one person
    • File Form 1 for Declaration of Compliance
    • File Form 18 Notice of situation of registered office of the company
    • File Form 32 for details of Directors, Secretary etc.
  • Company is registered within 10 – 15 business days; Certificate of Incorporation and Corporate Identification No (CIN) is issued

Timeline

7 - 10 Working Days

Once documents are provided, you can leave the rest of the formalities on us and expect the registration to be completed within 7 to 10 working days.

Details Required


  • Permanent Account No (PAN) of Directors and Shareholders.
  • Identity and address proof such as Aadhaar Card, Passport, Voter Identity Card, Driving License, Ration Card etc.
  • Residential proof with less than 2 months old Bank Statement or any utility bill (Electricity, Telephone, Water etc) having the name of the person.
  • For foreign nationals, Passport is mandatory, while any other government issued ID (residence or citizenship card or Driving license) and Bank Statement or any utility bill in the name of the person will be required as address and residential proof. English translation will be required in case the documents are not in English.
  • Passport size photographs (three) of each individual.
  • Board Resolution and Authorization, in case one shareholder is a company.
  • Certificate of Incorporation of the shareholder company.
  • Consent or No-Objection Certificate (NOC) from the landlord to use the address as registered office.
  • Address proof of landlord by way of less than two months old utility bill or tax receipt or sale deed.

FAQ

1 What is a DSC?

DSC stands for Digital Signature Certificate, using which you can sign electronic documents. For the registration of a Private Limited Company, all documents needed are electronic, therefore, a DSC is required by the partners.

2 Can one register a Private Limited Company on their home address?

Yes, one can register the company at their residential address. One requires to submit the utility bill copy of the same.