Overview
Starting a business is a big dream for many entrepreneurs in India. Among various business structures, a Private Limited Company is one of the most popular options. It offers benefits like limited liability, better credibility, and easy access to funding.
Registration of your business as a Private Limited Company opens new doors of opportunity, as it gives identification to your business, legal protection, and fund-raising options from various sources such as banks angel investors, venture capitalists,s and private equity investors.
Why
Registering your business as a Private Limited Company in India offers many advantages:
- Limited Liability Protection: Shareholders are liable or responsible only to the limit of their shareholding. Their personal assets remain protected.
- Separate Legal Entity: A PLC has its own legal identity, distinct from its owners. It can own property, sue, or be sued.
- Credibility and Trust: A registered company builds trust with customers, suppliers, investors, and financial institutions.
- Easy Funding: Venture capitalists and investors prefer investing in PLCs, which makes it easier to raise capital.
- Perpetual Succession: The company continues to be existed even if shareholders or directors change or pass away.
- Ownership Flexibility: Shareholders can easily transfer shares, making it easier to bring in new investors or partners.
Process
The process of registering a Private Limited Company in India involves these simple steps:
- Get Digital Signature Certificates (DSC): Each director needs a DSC to sign documents digitally.
- Apply for Director Identification Number (DIN): File an application to get DIN for all directors who don’t already have one.
- Name Reservation through RUN or SPICe+ Part A: Submit a request either through the MCA’s Reserve Unique Name (RUN) service or directly within SPICe+ Part A to check and reserve your preferred company name. Reserving the name in SPICe+ Part A is recommended for smoother processing as per latest MCA guidelines.
- Draft MOA & AOA: Prepare the Memorandum of Association (MOA) and Articles of Association (AOA), which define the company’s rules and objectives.
- Filing SPICe+ Form: Fill and submit the SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus) form along with e-MOA and e-AOA. SPICe+ covers company incorporation, PAN, TAN, EPFO, ESIC, GST, and bank account opening.
- Obtain Certificate of Incorporation: After MCA verification, you will receive the Certificate of Incorporation, which officially establishes your Private Limited Company.
- Apply for PAN and TAN: PAN and TAN are automatically applied for during the SPICe+ process.
- Open Company Bank Account: Use the Certificate of Incorporation and PAN to open a company bank account in the company’s name.
Documents
You need to collect and submit the following documents for Private Limited Company registration:
For Directors and Shareholders:
- PAN Card (mandatory for Indian nationals).
- Passport (mandatory for foreign nationals).
- Address Proof (Aadhar card, Voter ID, or Driving License).
- Residential Proof (latest bank statement or utility bill, not older than 2 months).
- Passport-size photographs.
- Digital Signature Certificates (DSC).
Note for Foreign Nationals: If you are a foreign national director or shareholder, your documents may need to be apostilled or notarized in your home country, as required by Indian regulations.
For Registered Office:
- Electricity Bill or Rent Agreement if rented.
- No Objection Certificate, refer as (NOC) from the property owner.
Fees
The cost of Private Limited Company registration depends on various factors like professional fees, state stamp duty, and number of directors. On average:
- Government Fees: It depends upon the capital contribution of the company and the state of incorporation. It may vary case to case.
Note: The exact fees may differ based on company size, number of directors, and professional services opted.
Timeline
The registration of a Private Limited Company in India typically takes 7 to 15 working days, depending on document readiness, name approval, and ROC processing time. Steps include obtaining DSC, name reservation, filing the SPICe+ form, and receiving the Certificate of Incorporation. Delays may occur due to errors or peak filing periods.
FAQs
A Private Limited Company is a legally registered business entity under the Companies Act, 2013, having limited liability and restricted share transferability. It must have at least two directors and shareholders and is suitable for startups and growth-oriented businesses.
To register, you need:
- Minimum 2 directors (at least one resident in India)
- Minimum 2 shareholders (can be same as directors)
- Registered office address in India
- Digital Signature Certificates (DSC) for all directors
- Director Identification Number (DIN)
- Properly drafted MOA and AOA
The process includes:
- Obtain DSC for directors
- Apply for name approval via SPICe+ Part A
- File incorporation documents via SPICe+ Part B
- Upload MOA & AOA
- Apply for PAN, TAN, EPFO, ESIC, and GST (optional)
- Receive the Certificate of Incorporation from MCA
There is no minimum paid-up capital requirement. A company can be registered even with ₹1 as paid-up capital.
The registration typically takes 7 to 15 working days, depending on how quickly documents are prepared, name approval is granted, and the Registrar processes the application.
No, a Private Limited Company requires at least two directors and two shareholders. However, a single individual can start a One Person Company (OPC) as an alternative.
Yes, a valid registered office address in India is mandatory. You can use a residential or commercial address, and proof like utility bills and NOC from the owner is required.
No, the entire registration process is online through the MCA portal (www.mca.gov.in). You can complete all steps electronically, including document signing and form submission.
After incorporation, a company must:
- Open a current bank account
- Appoint an auditor within 30 days
- Conduct board meetings and maintain statutory registers
- File annual returns and financial statements with MCA
- File ITR and other tax compliances
Yes, foreign nationals and NRIs can be directors or shareholders in a Private Limited Company, but at least one director must be a resident Indian (staying in India for at least 120 days in the financial year).
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