Articles

How a Company Can Be Formed in India?

by EzyBiz India Tax & Accounting Consulting Firm

Every upcoming businessman in India faces a crucial question of how to set up a business in India or how to form a company in India.

Further, when they use the word “company” they actually meant all the types of entities like a partnership, proprietorship, private limited company, and public limited company. This is because; they use “company” and “business” interchangeably.

In this write-up, we will try to understand company incorporation in India.

The Company can be defined as a legal enterprise or entity that is permitted by the legislation to carry on activities for the purpose of earning profits and gains. It can make applications to the government for creating a separate and independent organization to pursue certain objectives of the company.

The procedure of company incorporation in India has become quite easy and the entire process is online. It is governed by the Companies Act, 2013. A company can be incorporated in the following ways-


  1. Private Limited Company Registration
  2. Public Limited Company Registration


Private Limited Company Registration in India:

Minimum requirements for a Private Limited Company registration in India are as follows-

  1. A minimum of two shareholders is required.
  2. A minimum of two directors are required. The same person can be a shareholder as well as a director.
  3. At least One Director shall be an Indian Resident and Indian Citizen
  4. There should be a local office address in India for showing registered office.
  5. There is no minimum prescribed authorized and paid-up capital for private limited company registration.
  6. All the directors must have a Director Identification Number (DIN).
  7. All the directors are required to have Digital Signature Certificate (DSC).


Public Limited Company Registration in India:

Minimum requirements of a Public Limited Company registration in India are as follows-

  1. A minimum of seven shareholders is required.
  2. A minimum of three directors is required. The same person can be a shareholder as well as a director.
  3. At least one Director shall be an Indian Resident and Indian Citizen
  4. There should be a local office address in India for showing registered office.
  5. The minimum authorized share capital for this company incorporation in India is Rs. 500,000.
  6. All the directors must have a Director Identification Number (DIN).
  7. All the directors are required to have Digital Signature Certificate (DSC).


The procedure of Company Incorporation in India:

The following process is followed for registering a company in India as per the Companies Act, 2013-

  1. Obtaining a Digital Signature Certificate (DSC) from an authorized DSC issuing authority.
  2. Application for reserving a name for the company.
  3. Obtaining the Director Identification Number (DIN) by making an application in Form DIR-3.
  4. Drafting the Memorandum of Association (MOA).
  5. Drafting the Articles of Association (AOA).
  6. Filing of Form INC -7, Form DIR 12, and Form INC 22.
  7. Commencement of business after the registration is done completely.
  8. Providing the details of the registered office of the company to the Registrar of Companies (ROC).


Forms to be filed for Company Incorporation in India:

The following forms are to be filed online while undertaking the company registration process-

  1. E-Form DIR 3: Application for Director Identification Number (DIN) allotment.
  2. E-Form DIR 6: In case the details of the DIN are wrong, this form is to be filed with the Income Tax Department for making corrections.
  3. Form DIR 7: It is a verification form that is necessary to be attached with Form DIR 6. It must be verified by a professional.
  4. Form DIR 12: Providing details of all the directors.
  5. Form INC 1: Application for name approval of the company incorporation in India.
  6. E-form INC 7: Application for registration of the company along with all the necessary documents.
  7. Form INC 9: An affidavit from each of the subscribers and first directors to the Memorandum of the company.
  8. Form INC 10: For verifying the signature of subscribers of the company.
  9. Form INC 21: As compliance form to the Registrar of Companies (ROC) along with necessary documents.
  10. Form INC 22: For providing the details of the registered office or place of business.

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About EzyBiz India Advanced     Tax & Accounting Consulting Firm

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Created on Sep 23rd 2021 05:08. Viewed 90 times.

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