Know how to register a company in India by reading this article. Every day thousands of company/firms apply to get registered under the Ministry of Corporate Affairs. However, if you wish to open up a company it is a must that you need to register it under the Companies Act. 1956. Every Company has to be registered by the registrar of companies for the state.
Basic types of companies
There are basically two categories under the types of company-
- Private Company
- Public Company
To begin with the registration of the company the basic thing to understand the difference between the above two.
1. Private Company
- Minimum of two Board members is needed.
- A maximum number of members can be 50.
- They can start their company as soon as it is incorporated.
- Shares of this company cannot be sold to other people.
- Only two directors are allowed under this.
2. Public Company
- Minimum of seven Board members is needed.
- A maximum number of members can unlimited.
- They can start their company only when they get the commencement certificate.
- Shares of this company can be sold to others through the prospectus.
- It is must to have at least three directors under this.
How to register a company in India?
Know How to register a company in India? by reading the steps mentioned below. To begin with, the registration process following is the method-
1. Get the DIN (Director identification number)
The foremost thing to do is to register on the Ministry of Corporate Affairs website and follow the steps to get the DIN for the company to initiate. Fill in the DIN-1 form and attach up the necessary things required. Followed by filling the DIN-2 and DIN-3 forms as well pay up all the fees that are required to be paid as well. Once you are through with the DIN-3 form registrar of corporates can initiate the company.
2. Get the DSC (Digital Signature Certificate)
This step is important because the documents that we submit in the above should have some signs of the authority to ensure it’s validity. Under the Information Act, 2000 all the documents that are submitted electronically need to have some digital sign.
The digital signature certificate can only be valid and considered legal if they are given by the controller of certification agencies (CCA). If there is some digital signature on the forms and papers that you have submitted earlier then you do not require to get the DCS.
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3. Create an account on the MCA Portal
Once you get the DIN you need to register yourself as a new user on the portal of the Ministry of Corporate Affairs. Registering for the portal is free of cost and it makes it easy to pay up for the fees that have to be submitted in order to get the documents of the company sanctioned.
4. Apply for the Registration
This is the final step for getting into the completion of getting the company registered. You have to think of a company name as well, an address and then gather all the necessary documents such as the DIN, DSC. When all the documents are ready to go fill in the eform 1A. Once you have filled all the details in the eform 1A it goes to the ROC.
The main task of the ROC is to check that the company name is not already taken cause then it will be against the copyright provisions. The ROC usually takes up to two days to show up the final status of the company is registered or not. Once the ROC approves the company name, you have six months to make sure you register your company.
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5. Draft the MOA and AOA
The drafting part is really important as they need to set up the objectives and aim of the company. The Memorandum of Association contains the company’s business objectives. The Articles of Association contain details on the company’s daily operations, including its management and how the basic working of the company will take place.
These documents have to be duly signed by at least two members of the company and with one witness present when these signing process is taking place. The whole point of making the MOA and AOA is to bind the company and it’s fellow members not to go against each other and maintain the decorum.
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6. File all the documents online
Once you are through with getting the MOA and AOA notarized next you need to do is upload all the documents from the beginning over the site and get it into the notice of ROC. Make sure all the details that you enter are correct else the process might take longer and you will end up filling more forms than thought. Everything is done online on the MCA portal.
7. Collect the certificate
Once the ROC thinks that the uploaded documents are all fit, legal and genuine they will issue the certificate of incorporation and then you are good to go. In case the situation is such that the documents are not acceptable or some of the conditions under them are missing the ROC will not issue the certificate and rather you will be notified about the same. On being notified you can re-apply with all the necessary applications.
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However, it is a long process to follow up with each and every detail but then, in the end, you are good to go and have the permission to conduct your business. The objectives of your business must not go against the state or be for any illegal conduct as it will not be accepted.
You need to make sure that all the documents that you upload must be in order and avoid doing any errors. It is best if you recheck the documents before submitting them.
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You can also open up a company which is said as one-person company. This came in recently in the 2013 Amendment of the Companies Act. Under this if you are an entrepreneur so it is much beneficial for you because it is way easy to manage, and you even get easy loans from the Bank as well. However, the procedure remains the same but then you do not require any directors in the country you are the sole owner and you get to decide out what is the company about. With such an easement you get the legal recognition even if you are the sole person operating that company.