A successful incorporation process requires an understanding of the paperwork needed for company registration in India. It guarantees that the business registration form is completed and acts as a link between the visionary entrepreneurial goal of establishing a company and the legal compliance that turns this goal into reality! The type of company being registered by the ROC and the minimal prerequisites for its formation determine the paperwork needed for company registration. Therefore, it would be beneficial to have a better understanding of the various company registration kinds in India as well as their minimal criteria to better comprehend the paperwork needed for business registration in India.
This blog has a list of all the documents needed to register a company in India, along with thorough descriptions of their formats and uses. These consist of the promoters' documentation, the registered office's documents, and legal drafts such as the MOA and AOA.
Different Types of Companies
Selecting an appropriate organizational structure is essential before initiating a business in India. You can choose from a variety of company structures under the Companies Act of 2013 depending on your needs, goals, and compatibility. These kinds of businesses can be divided into groups according to their ownership structure, goal, and registration status. To help you choose an appropriate organizational structure, we have provided explanations for each of these company kinds below.
Companies Based On Registration
- Public Limited Company
According to the Companies Act of 2013, a public limited company must have three directors and a minimum of seven shareholders. To establish this business, there are no minimum or maximum capital requirements. Furthermore, because there is no upper limit to the number of owners or investors it can have, large-scale firms typically choose it. An online application and the list of papers required for company registration in India, which are covered in the following sections, must be submitted to the Registrar of Companies as part of the application-based process for registering a public limited company.
- Private Limited Company
According to the Companies Act of 2013, a private limited company must have a minimum of two directors and two shareholders. A Private Limited Company can be established with no minimum capital requirement, just like a Public Limited Company. The maximum number of stockholders these corporations can have is capped, though. There is a 200 cap on the number of members. Therefore, although Private Limited Companies are not as allowed to have as many stockholders as Public Limited Companies, the upper limit is still rather substantial. For this reason, medium-sized and large-scale firms typically choose to operate through a Private Limited Company. A Private Limited Company registers using the same procedure as a Public Limited Company. To accomplish this, a formal application with the documents discussed in the following sections is filed online with the ROC.
- One Person Company
Created by the Companies Act of 2013, a one-person company has a single shareholder. A one-person company, in contrast to a Private Limited Company, is limited to one stakeholder. Furthermore, the only shareholder allowed to hold shares in a Private Limited Company must be an individual citizen of India, not one of the foreign or Indian body corporations allowed. Furthermore, one director is the bare minimum needed to establish an OPC. OPC often suits small firms because of its constrained investment possibilities.
- Section 8 Company
The procedures for establishing a non-profit organization to support business, the arts, science, sports, education, research, social welfare, religion, charitable giving, and environmental preservation are outlined in Section 8 of the Companies Act of 2013. A license from the Central Government is needed before these companies can be established. Furthermore, you can choose to set up these organizations using either a Public Limited Company or a Private Limited Company. Shareholders of Section 8 Companies are not entitled to dividend payments. Furthermore, these businesses can only function to the Central Government's satisfaction, which means that the Government has the right to grant or withdraw these businesses' licenses whenever it pleases, based on justifiable causes.
Companies Based on Ownership
Private Company
There are restrictions on the share transfer process for private companies. Shares of a private company are not eligible for public trading or listing on stock exchanges. Additionally, it is forbidden for the general public to purchase shares in a private company. Even if an existing shareholder decides to leave the company, his shares are distributed to the other current owners before a new investor is asked to take his place.
Public Company
A Public Company, as opposed to a Private Company, is able to transfer its shares openly on stock market platforms and engage in free trading. Furthermore, shares of the Public Company may be purchased by the general public. Compared to a private corporation, the company is subject to stricter regulations because it is permitted to hold public funds as investments.
What Documents Are Required to Register a Company in India?
The paperwork necessary for incorporation is the crucial prerequisite for establishing a business in India. These records are essential to a company's ROC registration since without them, the application for the registration is not complete. Below is a list and explanation of every document needed to register a corporation in India. Before submitting these documents to the ROC for company registration, make sure you have them ready.
Company’s Promoters Documents
The promoters' KYC documents are the initial set of paperwork needed to register a company in India. The original directors and shareholders of a firm who participated in its founding and have some stake in its operations are known as promoters. The following documents, in scanned, self-attested copies, must be submitted by each of these promoters:
- PAN Card
- Adhar Card
- Driving License/ Voter ID/ Passport as an ID Proof
- Any utility bill/ bank statement with name and address written on it as an address proof
- Class 3 digital signature of the authorized director
Documents of the Registered Office
An organization's registered office is the address provided when it is incorporated. All public records refer to this address as the company's communication or correspondence address. The following Registered Office-related documents need to be presented at the time of incorporation:
- Evidence of Registered Office Address: Utility bills bearing the company name and registered office address may be given instead of proof of address. The Address Proof cannot be more than two months old.
- No Objection Certificate: Either a No-Objection Certificate from the owner of the property or a copy of rent deed is required.
Documents of the Company’s Constitution
Last but not least, the correct drafting of a few legal documents is necessary for the formation of a corporation in India. Our team of company secretaries and other staff is there to help you for this. These documents, written on suitable-value stamp paper, establish the company's legal identity. The following is a list of the constitutional documents for a company:
- Memorandum of Association: Because it includes the majority of a company's essential core legal information, the memorandum is referred to be its "charter." It is broken up into multiple clauses to draw attention to each feature independently. A Memorandum for a Private Limited and Public Limited Company includes six clauses, whereas one for a one-person company has seven. For your clear understanding, a list of all these clauses has been provided below.
- Name Clause: Specifies the company's officially approved and finalized name.
- Registrant Office Clause: Indicates the state in which the company's registered office is situated.
- Object Clause: Describes the company's principal business activity or activities.
- Liability Clause: This section addresses the company's liabilities, which shareholders are obliged to bear in case of winding up of the affairs of the company.
- Capital Clause: Information about the Company's Authorized and Subscribed Capital is contained in this clause.
- Articles of Association: The internal management of the company's rules and regulations are contained in the Articles. These policies are unique to each company and are determined by the senior management team. A few of the important regulations cover things like how to become a new shareholder, why an existing shareholder can be removed, how to transfer or transmit shares, whether shares are convertible, how to wind up the firm, and more.
Forms, Declarations, and Other Documents
- INC 9 - INC 9 is a declaration made by the company's shareholders and first directors stating that they have never before been found guilty of a crime, that they have never been found in violation of the Companies Act or breach of duty, and that the information and documents provided with the company registration form are accurate to the best of their knowledge.
- INC 14 - This is a declaration made by a practicing professional, such as an advocate, chartered accountant, cost accountant, or company secretary, attesting to the fact that all clauses, guidelines, and rules of the Companies Act and the Company (Incorporation) Rules have been followed in the process of creating the company's memorandum of agreement and articles of association and submitting the incorporate application.
- DIR 2 - DIR 2 is the form that those who wish to be appointed as directors of a corporation use to indicate their approval of the appointment. To let the ROC know that the directors' consent was obtained before their official appointment to the firm, the form must be included with the application for company registration.
One cannot emphasize the importance of the paperwork needed for company formation in India. These legal documents provide the foundation for a successful and compliant company establishment, acting as the link between your entrepreneurial goals and compliance with the law. You may start and finish your company formation process with ease and precision if you have a thorough understanding of the numerous documents needed for business registration, such as declarations, evidence of registered office, promoters' KYC, and company constitutions. Please don't hesitate to ask for our help if you need it!
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