Formation of Private Limited Company

A private limited company is a type of privately held small business entity. This type of business entity limits owner liability to their shares, limits the number of shareholders to 50, and restricts shareholders from publicly trading shares. Due to the legal status given the private limited company many business entities are opting for incorporating private limited company.

Documents Required

Document required for forming a private ltd companies are as follows:

• Copy of Pan Card
• Copy of Voter Id card
• Copy of address proof(Electricity bill, phone Bill documents should not be older than 2 months)
• Apply for DIN(Director’s Identification Number)
• Digital Signature Certificate(DSC)registration of the directors.
• Check Company name and fill and at least 4-5 Company name.
• File e-forms to ROC regional office on MCA Website like SPICE form.
• Pay ROC Stamp Duty.
• Confirm and Verify through a website.
• Issue a Certificate of your company.

Process of formation

Process of forming a private limited company is as follows-

• Choose a name- Utmost care should be taken while choosing a name for the company. The name chosen should be distinctive and suggestive of the principal activities of the company. The name chosen becomes the identity of the company.
• Have a company address- The company address is the registered office of the company at which all the official communications will occur. Post registration the applicant has to provide the permanent address of the registered office with ownership documents.
• Appoint at least two directors - A company need minimum two directors who have DIN to get registered. At least one of the two directors should be resident in India.
• Apply for DIN and DSC for each director- Every person who intends to become a director needs to obtain a DIN. DIN is eight digit unique number allotted to every person who wants to become a director. It is allotted by ministry of corporate affairs.

Digital Signature Certificate (DSC) is a digital signature which can be attached to an electronic document to verify the applicant’s identity.

• Have at least two shareholders: Minimum 2 shareholders are required to incorporate a company and maximum of 200 shareholders are allowed.
• Draft memorandum of association and articles of association:

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 defines the relationship of 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.

• File INC -32 with MCA – Spice INC-32 is an integrated form which is sent along with spice MOA 32 and spice AOA 34 for the incorporation of the company.
• Obtain certificate of incorporation:It is a certificate issued by the Ministry of corporate affairs/Registrar of companies for the commencement of business Certificate of incorporation is a conclusive evidence of the incorporation of the company.

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