How to register a Private Limited Company in India?

By Trademark Bazaar - 26th August 2017

How to register a Private Limited Company in India?

This article is describes the meaning of private limited company and the procedure for registering a private limited company. Further, it also states the benefits of the private limited company.

The Private limited company is the privately held business which can be incorporated with minimum 2 and maximum 200 members. Further, the liability of the members of the private limited company is limited to their share.

Benefits :-

Following are the benefits of private limited company-

  1. Limited Liability- One of the major benefits of the private limited company is that the liability of the members of the private limited company is limited to their shares only. Due to this the personal assets and the income of the shareholders are protected at the time of crises.
  2. Separate Identity- The legal identity of the private limited company is separate from its members. Thus, the company is empowered to sue and be sued on its own.
  3. A Number of members and shareholders- To incorporate a private limited company only two members and two shareholders are required. This makes it easy for the entrepreneur to start a business.
  4. Tax Benefits- Private Limited Companies are only taxed on their profits and are not subject to the higher (personal) tax rates that are placed on sole traders or partnerships.
  5. Perpetual Succession- As the Private limited company is a separate legal entity from its members thus their life is not affected by the death of their members.

Documents required for registering a Private limited company :-

  • Copy of Pan Card
  • Copy of Voter Id card/ Driving License/Passport
  • Copy of address proof (Electricity bill, phone Bill documents should not be older than 2 months)
  • Photographs of Director’s

Procedure of obtaining Company registration in India :-

Step-1-Applying for DIN (Director’s Identification Number)

To start the procedure of registration every director of the company is required to obtain their Director’s identification number. In order to obtain a DIN the director’s needs to file an electronic Form DIN-1 that is available on the Official site of the ministry of corporate affairs.

  • The applicant is required to register himself on MCA Website and have a login id. Further, the applicant shall upload the filled form by clicking to electronic Form upload button on MCA website and should pay applicable fees.
  • As soon as the DIN will get generated the director is required to intimate the company about the same using Form DIN-2.
  • Further, proposed company should intimate the Registrar of Corporates(ROC) about all director’s DIN through DIN-3 Form.

 Step 2: Obtaining Digital Signature Certificate (DSC):

As per information act 2000, the documents submitted electronically shall contain a valid digital signature on. This provision is made in order to ensure safe submission of the required documents electronically. The digital signature certificate should be acquired by only those agencies which are appointed by the controller of certification agencies (CCA). One should not use DSC given by any other agency which is not approved and it’s illegal to use others DSC as yours or the false one.

The Digital signatures can be acquired from these government listed agencies like TCS, IDBRT, MTNL, SAFESCRYPT, NIC, nCODE Solutions etc.

Step 3: Creating the new registration account on MCA Portal

 To facilitate the procedure of incorporation it is crucial to acquire the registered user account on MCA Portal for filing an e-Form, for online fee payment, for different transactions as registered and business user. Creating an account is totally free of cost.

Step 4: Filing of electronic forms

Through this step the applicant is required to file electronic forms relating to incorporating company name, registering the office address or notice of situation of office and notice for appointment of company directors, manager and secretary also regarding the take and pay for their qualification shares. The forms for these purposes are as follows-

  • Form-1: Through this form, an application for availability or change of a company name shall be made. The applicant is enabled to provide minimum four and maximum six names for the name of the proposed company. The name chosen must be unique and shall not resemble with the name of any existing company in India.
  • Form-18: This form is for notice of the situation of a new company office or change of situation of previously registered office.
  • Form-32: Through this form notice for appointment of new Directors, Managers and Secretary shall be submitted.

Step-4 -Drafting Memorandum of Association and Article of Association

The MOA and AOA of the proposed company shall be drafted.

Memorandum of Association- Memorandum of association is a document which defines the relationship of the shareholders with the company. It basically contains the objectives and powers of the company.

Articles of association- They are the bye-laws which define the relationship of the company with outsiders. Information such as the total number of members, share capital, rules for a meeting of the company, voting power of members must be included in the Articles of Association.

Step-5- Certificate of incorporation

After the careful scrutiny of the application and document submitted the MCA may grant the certificate of incorporation to the proposed company. Further, the applicant will receive a confirmation email regarding the application for incorporation of a new company, and the status of the form will get changed to Approved.


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