Why should you register your business as a Private Limited Company?

There are many advantages to registering your business as a Private Limited Company. Some of the key benefits are as follows:

• Limited liability protection for shareholders: One of the main benefits of registering your business as a Private Limited Company is that the shareholders have limited liability. This means that their assets are protected in case the company goes into debt or faces legal action.

• Separate legal entity: A Private Limited Company is a separate legal entity from its owners. This means that the company can own property, sue or be sued in its name, and enter into contracts.

• Easy to raise funds: A Private Limited Company can easily raise funds through equity or debt financing. This is because investors are more likely to invest in a Private Limited Company as it offers them limited liability protection.

• Perpetual succession: A Private Limited Company has perpetual succession. This means that the company continues to exist even if the shareholders change.

• Credibility: Registering your business as a Private Limited Company can enhance its credibility in the eyes of customers, suppliers, and investors. It gives them the confidence that the business is legitimate and follows the rules and regulations set by the government.

Legal Requirements for Private Limited Company Registration in India

To register a Private Limited Company in India, the following legal requirements must be met:

Minimum Requirements

• At least two directors

• At least two shareholders

• Minimum authorized capital of Rs. 1 lakh

Documents Required

• PAN card of all directors

• Aadhaar card of all directors

• Address proof of all directors

• Bank statement or utility bill as proof of registered office address

• Memorandum of Association (MOA) and Articles of Association (AOA)

• Declaration of compliance with all legal requirements

Meeting these legal requirements is crucial for the successful registration of a Private Limited Company in India. It is important to ensure that all necessary documents are in place and that the minimum requirements are met before submitting the application for registration. By following the necessary steps and meeting the legal requirements, you can ensure a smooth and hassle-free registration process for your Private Limited Company in India.

Overview

Introduction

In India, the Private Limited Company structure has become one of the most preferred and widely used forms of business entities. Private Limited Company Registration offers several benefits and advantages to entrepreneurs, including limited liability protection, separate legal entity status, and easier access to funding. If you are planning to start a business in India, registering a Private Limited Company could be the perfect choice for your business.

What is a Private Limited Company?

A Private Limited Company is a type of business entity in India, where the liability of the shareholders is limited to the extent of their share capital contribution. It is a separate legal entity that is managed by its board of directors and owned by its shareholders. The Private Limited Company structure offers several benefits over other forms of business entities, including limited liability protection, perpetual succession, and easier access to funding.

How to Register a Private Limited Company in India?

The process of Private Limited Company Registration in India involves several steps, including obtaining a Digital Signature Certificate (DSC), Director Identification Number (DIN), Name Approval, MOA and AOA, and incorporation of the company.

• Obtaining Digital Signature Certificate (DSC)- The first step in the process of Private Limited Company Registration in India is to obtain a Digital Signature Certificate (DSC) for the proposed directors of the company. A DSC is a secure digital key that certifies the identity of an individual or an organization for online transactions. It is necessary for the proposed directors to obtain a DSC before applying for a Director Identification Number (DIN).

• Director Identification Number (DIN)- The next step in the process of Private Limited Company Registration in India is to obtain a Director Identification Number (DIN) for all the proposed directors of the company. A DIN is a unique identification number allotted by the Ministry of Corporate Affairs (MCA) to individuals who wish to become directors of a company. It is mandatory for all the proposed directors to obtain a DIN before proceeding with the registration process.

• Name Approval- The third step in the process of Private Limited Company Registration in India is to obtain Name Approval for the proposed company. The proposed name of the company must be unique, and it should not be similar or identical to any existing company or trademark. The name approval process can be done through the MCA portal or a professional service provider.

• MOA and AOA- The next step in the process of Private Limited Company Registration in India is to draft the Memorandum of Association (MOA) and Articles of Association (AOA) of the company. The MOA and AOA are the legal documents that define the objectives, scope, rules, and regulations of the company. These documents must be prepared in accordance with the latest amendments to the Companies Act, 2013.

• Incorporation of the Company- The final step in the process of Private Limited Company Registration in India is to incorporate the company with the Registrar of Companies (ROC). The application for incorporation must be filed with the ROC along with the necessary documents, including the MOA and AOA, and the address proof of the registered office of the company.

Follow the general instructions listed below while furnishing the digital signature application form:

• The signature of the applicant should be in blue ink only
• The signature of the applicant should be as it is in the Identity Proof
• A photo of the applicant in the application form should be signed by the applicant
• All supporting documents should be attested by either Gazetted Officer / Bank Manager / Post Master
• For proof of attesting officer, either one of the below is mandatory –
• Contact Details of Attesting Officer including the name, designation, office address, and contact number. This should be part of the attestation. If provided separately, it should be attested either by the Applicant or Attesting Officer
• Self-Attested copy of the Organizational Identity card of the Attesting Officer
• Organizational Documents can also be attested by Authorized Signatory. However, if the taxpayer fails to get the Organizational Documents attested by the authorized signatory, an attested copy of the organizational ID card of the authorized signatory is mandatory.

How Digital Signature work

Like handwritten signatures, digital signatures are unique to each signer. The providers of digital signing solutions, such as DocuSign, follow a specific protocol called Public Key Infrastructure (PKI). PKI requires the provider to use a mathematical algorithm to generate two long numbers called keys. One key is public, and one key is private.
When someone electronically signs a document, the signature is created using the signer’s private key, which is always securely kept by the signer. The mathematical algorithm acts as a cypher, creating data matching the signed document, called a hash, and encrypting that data. The resulting encrypted data is the digital signature. The signature is also marked with the time that the document was signed. If the document changes after signing, the digital signature is invalidated.
For instance, suppose that Jane signs a timeshare sale agreement with her private key. The buyer receives the document. A copy of Jane's public key is also sent to the document's purchaser. If the signature is not Jane's or the document has changed since it was signed, the public key will be unable to decrypt it using the cypher that produced the keys. The signature is then invalid. To ensure the integrity of the signature, PKI mandates that keys be generated, carried out, and stored securely. As a result, a reliable Certificate Authority (CA) is typically required. Companies that provide digital signatures, like DocuSign, address the PKI criteria for secure digital signatures.

India Advocacy for Private Limited Company

Are you looking to start a business in India and want to ensure maximum protection for your assets? Registering your company as a Private Limited Company is the perfect solution and we at India Advocacy are here at your doorstep!

By registering as a Private Limited Company, you will not only gain the benefits of limited liability, but you will also be able to raise capital through the sale of shares to investors. This means you can scale your business quickly and efficiently, without worrying about personal financial risk.

Furthermore, registering your company as a Private Limited Company will give you credibility in the eyes of potential customers and clients. It shows that you are serious about your business and are committed to following all legal requirements.

Conclusion:

When it comes to India Advocacy, registering your company as a Private Limited Company is particularly important. India has a complex regulatory environment, and having a legal structure that is recognized and respected by government agencies and stakeholders can help you navigate the legal landscape with ease with the assistance of India Advocacy.

So don't wait any longer - register your company as a Private Limited Company today and enjoy the benefits of limited liability, and increased credibility through the services of India Advocacy. Contact us now to get started with India Advocacy!