Private Limited Company
Private Limited Companies are governed by the Companies Act, 2013 and require a minimum of 2 Directors and 2 Shareholders with one of the Directors being an Indian Resident and Indian Citizen.
To register a company in India
- 2 Directors — 1 Person should be an Indian National and Indian Resident
- 2 Shareholders — The Directors can be shareholders
- Registered Office in India
Limited Liability Partnership
- LLP Registration in India has become an alternative form of business that provides the advantages of a Company and the flexibility of a Partnership firm into a single organisation.
- The Concept of LLP in India was introduced back in 2008 by the Limited Liability Partnership Act of 2008.
- This unique hybrid is suitable for setting small, medium-sized businesses.
- To register an LLP minimum of two partners are required, there is no upper limit as such.
- The partners are responsible for the compliances and all the provisions that are specified in the LLP agreement.
Public Limited Company
- A Public Limited Company under Company Act 2013 is a company that has limited liability and offers shares to the general public.
- Its stock can be acquired by anyone, either privately through (IPO) initial public offering or via trades on the stock market.
- A Public Limited Company is strictly regulated and is required to publish its true financial health to its shareholders.
- Minimum 7 shareholders are required to form a public limited company.
- Minimum of 3 directors is required to form a public limited company.
- A minimum share capital of Rs. 5 lakhs is required.
Capital Required to Start a Company
A company can be started in India with a very minimum amount of capital. There is no fixed amount and the shareholders of the company being incorporated can determine the capital they wish to contribute. While setting up the capital structure of the company, the following are some of the concepts to be kept in mind
- Face Value of Share
The face value of a share is the price per share with which the company is incorporated. Normally, the face value of share is Rs. 1 or Rs. 10 or Rs. 100 or Rs. 1000 or Rs. 10,000.
- Authorised Capital
Authorised capital is the total value of shares a company can issue to shareholders. Normally, all companies are incorporated with an authorised capital of Rs. 1 lakh or Rs. 10 lakhs. If a higher authorised capital is required, the company would be required to pay additional fees to the Ministry of Corporate Affairs. The authorised capital of a company can be increased at any time after incorporation.
- Paid-up Capital
Paid-up capital of a company is the number of shares issued to shareholders for which they have paid or deposited money to the company. Paid-up capital of a company cannot be more than the authorized share capital of the company.
Registered Office of Company
All companies registered in India are required to maintain a registered office in India. The registered office must have a board with the name of the company and should be a place where notice or communication if any can be served. Hence, the registered office of a company cannot be vacant land or under construction premises.
GST Registration after Company Registration
During the company registration process, the Directors can opt to obtain GST registration along with the incorporation. However, it is not mandatory for a company to be registered under the GST unless certain turnover limits are crossed.
Bank Account of Company
After company registration, a bank current account must be opened in the name of the company within 180 days and the subscription amount must be deposited.
Documents required to open bank account for a company
- Incorporation Certificate of Company
- Directors KYC Documents
- Board Resolution Authorising the Directors to open Bank Account
- Address Proof of the Company
