Private Limited Company in India is the most popular legal structure for businesses, should be chosen who wants to scale business in future. Private Limited Company limits the liabilities of its shareholders.
Private limited company registration is governed by the Companies Act, 2013 and the Companies Incorporation Rules, 2014. Minimum of two shareholders and two directors are required to register a private limited company, shareholder can be a natural person or legal entity too however for directorship only individual is eligible. Startups and growing businesses choose to register a company in India as routing investment in private limited company is easiest. It is most recommended form of business entity as it offers many benefits and advantages such as limited liability protection to shareholders, ability to raise equity funds, separate legal entity status, perpetual existence, greater flexibility and transparency.
LIMITED LIABILITY- The greatest benefit of Private Limited Company is limited liability. Members are only liable for unpaid shares held by them and not more than that, there is no personal liability of shareholders to the creditors of a company for company's debts.
Limit - private limited company must have at least two directors and shareholders, and can have a maximum of 15 directors and 50 shareholders.
Perpetual Succession- Private Limited Company goes on and on until it is legally dissolved. As private limited company is having separate legal identity, so it is unaffected by the death or other exit of any member and continues to be in existence irrespective of any changes in ownership.
Investment-ready- Private limited companies easily accommodate equity funding as there is a clear distinction between shareholders and directors as well as limited liability. This feature also gives you the ability to hire top talent by offering them ESOP in company. Companies can also issue equity shares, preference shares, debentures and accept deposits with RBI permission, however shares can't be openly sold in market as of public limited company.
Compliances- It is necessary for a company to audit its books of accounts irrespective of its turnover and also need to file annual statement within stipulated time given by government, if not done penalties and prosecution is attracted.
Property Ownership - Private Limited Company being an artificial person, can acquire, own, enjoy and alienate, property in its name, property may be tangible or intangible such as machinery, land & building, factory, trademark, patent etc., shareholders can't exercise their rights on property of company.
ComplyPartner Team would understand business
Day 1- Application for DIN and DSC, it will take 1-2 days
Day 3- Application For Name Approval, it would take 3-5 Days
Bank Account can be opened and business can be started
Day 16- Pvt. Ltd. Registration Certificate Issued would be issued
Day 8- Application for registration, it would take 7-9 Days
All Directors and Shareholders need to provide Self-attested copy of
ID Proof (Aadhar card/ Voter ID/ driving license)
Address Proof in the name of Director (Any utility bill i.e., mobile bill/water bill/ electricity bill, or bank statement which should not be older than two months)
4 Passport Size Photographs.
Address proof of registered office
Any utility Bill (i.e., mobile bill/water bill/ electricity bill) of the registered office