REGISTRATION OF YOUR COMPANY – WHAT AND WHY?
If you are looking forward to becoming an entrepreneur and wish to start up a private ltd company in India, you must familiarise with the requirements of registration of company and the mandatory legal compliances, in the default of which you may face prosecution. Incorporation of a company gives several advantages such as an independent corporate existence, limited liability of members, transferability of shares, etc. A company may be formed for any lawful purpose of three types:
- Public Company: by 7 or more persons
- Private Company: by 2 or more persons
- One Person Company (OPC): by one person only
Registration of company is obtained by filing an application with the Registrar of Companies (RoC), along with the Memorandum of Association, Articles of Association, copy of the Agreement with any individual to be the Director or Manager (if any), and a declaration of compliance with provisions of the Act. When the Certificate of Registration is granted, it marks the birth of the company as a legal person. But the requirements of law certainly do not end there, and there are post-registration compliances that are to be met, as we shall see below.
- Application for Commencement Certificate: An Application stating that the prescribed amount of share has been paid to the company by the shareholders.
- Registered Office: Within 15 days of incorporation, and during all times thereafter, the Company must have a Registered Office, to receive all communications and Notices.
- Board Meeting of Directors: The first one must be held within 30 days of incorporation.
- Appointment of Auditors: To be done within 30 days of incorporation of Company, using Form ADT 1: an Auditor is appointed for a period of five years.
- Share Certificates: Document evidencing that a particular person holds a specific amount of share in the Company; to be issued with a valid seal of the Company.
- PAN/TAN Application: To be done within 30 days of incorporation; apply to the Income Tax Authorities.
- Information to RoC: When a resolution is passed in the Board Meeting such as issuing securities, borrowing money, investing finds of company, etc.; or Special Resolutions are passed for alteration of AoA, conversion of Pvt Ltd company into OPC, etc.; intimation has to be given to the RoC within 30 days, via Form MGT 14.
- Additional Compliance for Pvt Ltd Companies:
- File Form INC-1 with RoC: Stating that each subscriber to the MOA has paid their value of shares, and paid-up capital of the Enterprise is not less than Rs. 1 Lakh.
- Register Bank Accounts and Tax Returns
- Disclosure of Director’s interest: Directors are required to disclose their concern or interest in other Companies, Bodies Corporate, other Firms, etc.; also have to declare that the Directories are not disqualified under the Act. This has to be made from time to time, and is a standing compliance.
- Annual General Meetings: Once in every Calendar Year; within 6 months after the end of each Financial Year.
- Additional compliances for OPC:
- OPC Bank Account
- Financial Statements
IMPORTANT STATUES TO BE KEPT IN MIND (INDIAN KANOON)
- The Companies Act, 2013
- SEBI Act
- Income Tax Act
- ICDR Regulations
- LODR Regulations
- Common Seal
- Statutory Register
- Paint/Affix address of registered office in all other Branches
- Corporate Identity Number