Private Company Registration

A private limited company can be registered online in less than two weeks through online registration process by us.

About Private Limited Company:

Private Limited Company is most preferred types of company in India due to very less compliance requirement compared to other types of company and is governed by the Companies Act, 2013.

Minimum requirements for registration of Private Limited Company in India :

  • 2 Shareholders – The Directors can be shareholders;
  • 2 Directors – 1 Person should be an Indian National and Indian Resident;
  • Registered Office in India

100% Foreign Direct Ownership (FDI) is permitted in most sectors in India and

No restriction on foreign shareholding of a private limited company.

Documents Required for Registration of Private Limited Company

The following documents of proposed directors are required as proof of identification in order to register a company:

Foreign Nationals: Passport is mandatory

Indian Nationals: PAN card mandatory

Address Proof :

Indian Nationals: 

Passport or Driver’s License or Election ID or Ration Card or Aadhar;

Foreign Nationals: 

Drivers License or Residence Card or Bank Statement;

Proof of residency: Last two months.

Foreign Nationals: 

Electricity Bill or Bank Statement or Phone Bill

Indian Nationals: 

Electricity Bill or Bank Statement / Phone Bill

If one of the company’s shareholders is a company based in India or abroad, the following documents must be submitted:

  • Board resolution authorizing investment in the company
  • Address proof of the company
  • Incorporation Certificate of the Company

Capital Required to Start a Company

No fixed amount and the shareholders of the company being incorporated can determine the capital they wish to contribute.

Capital Structure of company

Face Value of Share: The face value of a share is the price per share with which the company is incorporated. Normally, the face value of share is Rs. 1 or Rs. 10 or Rs. 100 or Rs. 1000 or Rs. 10,000.

Authorised Capital: Authorised capital is the total value of shares a company can issue to shareholders. Normally, all companies are incorporated with an authorized capital of Rs. 1 lakh or Rs. 10 lakhs. If a higher authorized capital is required, the company would be required to pay additional fees to the MCA

The authorised capital of a company can be increased at any time after incorporation.

Paid-up Capital: Paid-up capital of a company is the number of shares issued to shareholders for which they have paid or deposited money to the company. Paid-up capital of a company cannot be more than the authorized share capital of the company.

Company Registration Process

Steps for registering a private company:

Step 1: RUN Name Approval

An application for company name approval is first submitted to the Ministry of Corporate Affairs to reserve the company name.

One or two names with business objectives can be submitted.

If a name approval is rejected, one or two more names can be resubmitted.

Normally, the MCA approves all name approval applications in less than 5-6 working days.

Step 2: Digital Signature for Directors

Digital signatures are mandatorily required for the Directors before incorporation.

Step 3: Incorporation Application Submission

Filing of application in SPICe Form to the MCA with all relevant attachments.

Filing of Memorandum of Association (MOA) and Articles of Association (AOA) of the company.

MCA issues Incorporation Certificate if everything is in order.

Compliances by private limited company

Once a company is registered in India, various compliances must be maintained from time to time to avoid penalties and prosecution. The following are some of the compliances a company would be required to complete after company registration:

Auditor Appointment: All companies registered in India must appoint a practicing and licensed Chartered Accountant registered with the ICAI within 30 days of incorporation.

Director DIN KYC: All persons who hold a Director Identification Number (DIN) – which is allocated during the incorporation process must complete DIN KYC each year to validate the phone and email address on record with the Ministry of Corporate Affairs.

Commencement of Business: Within 180 days of incorporation, the company must open a Bank Current Account and the shareholders must deposit the subscription amount mentioned in the MOA of the company. Hence, if the company was to be incorporated with a paid-up capital of Rs. 1 lakh, then the shareholders must deposit Rs. 1 lakh in the Company’s bank account and file the bank statement with the MCA to obtain a commencement of business certificate.

MCA Annual Filings: All companies registered in India must file a copy of the financial statements with the Ministry of Corporate Affairs each financial year. If a company is incorporated between January – March, the company can choose to file the first MCA annual return as a part of the next financial year’s annual filing. MCA annual return consists of Form MGT-7 and Form AOC-4. Both these forms must be digitally signed by the Directors and a practising professional.

Income Tax Filing: All companies must file an income tax return using Form ITR-6 each financial year. Income tax filing must be done for each financial year before the due date – irrespective of the incorporation date. The income tax return of a company must be digitally signed using one of the Director’s digital signature.

Registered Office of Company

All companies registered in India are required to maintain a registered office in India. The registered office must have a board with the name of the company and should be a place where notice or communication if any can be served. Hence, the registered office of a company cannot be vacant land or under construction premises.

After incorporation, the registered office of a company can be changed if required. In case the registered office is changed within the same city or same Registrar of Company, the process can be completed easily. In case the registered office of a company is changed from one state to another, the process would be longer and more cumbersome.

GST Registration after Company Registration

During the company registration process, the Directors can opt to obtain GST registration along with the incorporation. However, it is not mandatory for a company to be registered under the GST unless certain turnover limits are crossed. You can know more about the turnover limit and process for obtaining GST registration in our detailed guide on GST registration in India.

Bank Account for Private Limited Company

After company registration, a bank current account must be opened in the name of the company within 180 days and the subscription amount must be deposited. If the above steps are not completed, the commencement of business certificate would not be issued and a penalty would be applicable.

The following are documents required to open bank account for a private limited company:

  • Incorporation Certificate of Company
  • Directors KYC Documents
  • Board Resolution Authorizing the Directors to open Bank Account
  • Address Proof of the Company

Advantages of Private Limited Company

The following are the major advantages of incorporating a private limited company in India versus other entity types.

Separate Legal Entity

A company is both a legal entity and a juristic person. Therefore, a company has broad legal rights to like acquiring property, incurring debts, hiring people, etc. As a company is a separate legal entity, the company’s members (shareholders or directors) are not personally liable for the company’s liability.

Limited Liability

A private limited company is a separate legal entity with limited liability provisions. Therefore, the shareholders are not liable for the losses of the company – for an amount more than what was invested by them into the company as share capital.

Uninterrupted Existence

A company has ‘perpetual succession,’ which means it will continue to exist until it is legally dissolved. Because a company is a separate legal entity, it is unaffected by the death or other departure of any of its members, and it continues to exist regardless of membership changes.

Fund Raising

A private limited company has multiple options for fundraising. A company can raise funds from shareholders, investors, angels, venture capital funds, private equity funds, foreign funds, NBFCs, banks and other financial institutions. Only a company can raise debt and equity funds from investors.