According to the Companies Act 2013, Pvt. Ltd. companies are given special benefits and exclusions. A Pvt. Ltd. firm must have two members and the word "private" in its name in order to be registered in India. Family members frequently work for these kinds of businesses. In this blog, we will let you know about what is a private limited company in detail.
What is a Private Limited Company?
In accordance with Companies Act of 2013, a private limited company is an organization whose laws restrict the shares transferability and forbid the general public from subscribing to them. It is a crucial feature that differentiates it from other kinds of companies.
A private limited company must have a minimum of two minimum and 15 maximum directors. For shares to be legally distributed, there must be not less than two shareholders and a maximum of 200 shareholders.
Characteristics of Private Limited Company India
Minimum Members:
A minimum of two members and a maximum of 200 members are required to form a private limited company, according to the Companies Act of 2013.
Capital Requirements:
It should have more than 1 lakh INR in paid-up capital or a higher amount as determined by the Board from time to time.
Minimum subscription:
The private limited company India minimum subscription is the amount that covers 90% of the shares that are issued within a certain time frame. If the organization doesn't get 90% of the assets, proceeding with operations will not be possible. A public limited company can give offers to general society without requiring a minimum membership.
Name:
Any private company's name must be followed by "private limited."
Limited Liability:
The liability of every member or shareholder is limited. It means that shareholders may be compelled to sell their own assets in order to make up the difference if a company makes a loss in any way. The personal assets of the shareholders are unaffected. persists
Perpetual succession:
From a legal standpoint, the private limited company will remain in existence even if one of its members passes away, becomes bankrupt, or dies. Consequently, the business can continue to operate indefinitely. The company will run and operate until the law stops its existence.
What is the minimum requirement for Pvt Ltd Company Registration?
For Pvt Ltd Company Registration, the minimum requirements are:
There must be at least two directors.
A private limited company's directors should be Indian citizens who live in the country.
One of the other directors might be from outside the country.
Two investors are likewise expected for a firm to exist.
Investors may be people or legal entities.
Documents required for Pvt. Ltd. Company Registration
Memorandum of Association:
The memorandum of association talks about the goal of starting a business, the type of business, the goal of the business, and the capital clause. A corporate document lays out the company's objectives and relationships with shareholders.
Article of Association:
It includes the internal working rules and regulations of a company. It discusses the management procedure, the duties and responsibilities of each member, the dividend policy, shareholder meetings, and director appointments. The directors receive a certificate or license after submitting the necessary paperwork for registration. The Registrar of Companies (ROC) in India issues this document as the primary means of company authentication.
Other Documents:
Other documents include:
Identity proof (PAN card, Aadhaar card).
Proof of address (ration card, voter ID).
A rental agreement.
Notice of occupancy from the property owner.
A copy of the sale deed for the held property for all directors and shareholders of the company.
Process of Private Limited Company Registration in India
Step 1: Obtain a DSC(digital signature certificate).
Step 2: Request a DIN (Director Identification Number)
Step 3: Name Approval of the form
Step 4: SPICe+ Form (INC-32)
Step 5: e-MoA and e-AoA (INC-33) (INC-34)
Step 6: Application of PAN and TAN
Benefits of Incorporating a Private Limited Company India
No Minimum Capital:
A Private Limited Company can be established without requiring any initial capital. A private limited company's authorized share capital may be as low as Rs. 10,000.
Separate Legal Entity:
A Private Limited Company has its own legal personality, which means that the assets and obligations of the company are distinct from those of the directors. Each is counted independently. Because ownership and management are separate in a Private Limited Company, managers are accountable for the business's success and failure.
Limited Liability:
Members' personal assets will not be used to pay the company's debts if the company becomes financially troubled for any reason, as a person's liability is limited to the number of shares they hold.
Secrecy:
In essence, a private limited company is a family business. It is not necessary to make its decisions and actions known to everyone. Publishing or making its financial statements available for public review is not required. As a result, it is easy to keep its business dealings a secret.
Do you want to register your Private Ltd. Company in India? Or to know what is Private Limited Company? For your complete information about Pvt. Ltd. Company or online company registration in India, you can reach out to Lawgical india.
