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Company Law in India

Company law in India, governed by the Companies Act, 2013, regulates the formation, operation, and dissolution of companies. The Act is administered by the Ministry of Corporate Affairs (MCA) and establishes the business operations. It focuses on ensuring compliance with statutory obligations, maintaining transparency, and defining accountability structures within the context of legal requirements.

While the Companies Act, 2013, lays the groundwork for governance from a legal perspective, sector-specific governance requirements may also fall under the purview of other regulatory bodies, such as the Securities and Exchange Board of India (SEBI) or the Reserve Bank of India (RBI). These authorities oversee specific industries, ensuring that entities operate according to their respective frameworks in addition to the broader provisions of the Companies Act.

What is Company Incorporation in India?

In India, incorporation of a company is the legal process of forming a corporate entity under the Companies Act, 2013. This process involves registering the company with the Ministry of Corporate Affairs (MCA), after which the company becomes a separate legal entity, distinct from its owners, and is recognized by law.

Incorporation applies to entities such as Private Limited Companies (Pvt Ltd), Public Limited Companies, Limited Liability Partnerships (LLP), One Person Companies (OPC), and Section 8 Companies. It does not apply to unincorporated entities like sole proprietorships or general partnerships.

Company structures in India

Business RegistrationInternational Business SetupComplaince ServicesOther Services

Start your business seamlessly with expert guidance. Whether you're forming a private limited company, LLP, or any other entity, we ensure a hassle-free process by managing everything from documentation to government approvals.

Private Limited Company Registration

Ideal for startups, offering limited liability and simplified venture capital raising. Secure investor funding effortlessly and protect your personal assets.

Limited Liability Partnership (LLP) Registration

LLP combines limited liability with operational flexibility. Perfect for small businesses and professionals seeking liability protection without the rigid corporate structure.

One Person Company (OPC) Registration

OPC is the ideal choice for solo entrepreneurs, offering limited liability and a corporate structure without the need for partners.

Sole Proprietorship Registration

A sole proprietorship is the simplest business structure, ideal for small businesses. Enjoy full control, minimal compliance, and easy setup.

Nidhi Company Registration

Nidhi Company is perfect for promoting savings and lending among members. Experience simplified registration and full compliance with government regulations.

Producer Company Registration

Tailored for agriculture-based businesses, Producer Company supports farmers and rural producers. Gain legal recognition with an easy setup and operational benefits.

Partnership Firm Registration

Simple and flexible, a Partnership Firm is ideal for small businesses. Easily formed with minimal compliance, allowing shared responsibility. Register your firm quickly and start operating!

Startup India Registration

Register your firm under the Startup India scheme. Enjoy tax exemptions, funding opportunities, and simplified compliance. Start today and accelerate growth!

Register your business outside India

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USA Incorporation

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Singapore Incorporation

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UK Incorporation

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Netherland Incorporation

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Not Sure About Your Business Type?

Feeling uncertain about the ideal business structure?  Consult with our experts for guidance and support in finding the right one for you

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Procure your DSC and DIN

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File , MoA, AoA, PAN,TAN and Get incorporation certificate

Register Your Company in India

Register Your Company in India

Registering a company in India is the foundational step for legally establishing your business. Under the Companies Act of 2013, any entity can be formed for lawful purposes by following the guidelines set by the Ministry of Corporate Affairs (MCA). Company registration not only provides the entity with a unique legal identity but also grants various rights and protections under Indian law.

Choosing the correct company structure is critical, as it impacts operational efficiency, compliance requirements, and the ability to meet business objectives. Options include private limited companies, limited liability partnerships, and sole proprietorships, each offering distinct advantages. Registering a company in India enables businesses to access government incentives, claim legal rights, and build credibility in the market.

The MCA’s official portal offers a streamlined process for registering a company, allowing businesses to obtain their legal identity and operate with compliance.

    Benefits of Incorporating a Company in India

    The process is governed by the Ministry of Corporate Affairs (MCA) and involves registering business with the Registrar of Companies (RoC), along with obtaining a Digital Signature Certificate (DSC) and Director Identification Number (DIN).

    Key steps include obtaining a Digital Signature Certificate (DSC), Director Identification Number (DIN), and filing the SPICe+ form via the MCA portal, which integrates multiple services like company registration, PAN, TAN, and GST registration.

    Top Benefits of Company Incorporation

    Separate Legal Identity

    Once incorporated, the company becomes a distinct legal entity. It can own property, sign contracts, and operate independently of its owners.

      Limited Liability Protection

      Shareholders’ personal assets are safeguarded from company debts or risks, ensuring financial security.

        Eligibility for Government Schemes

        Incorporated companies can access government schemes such as:

        • Startup India: Offers tax exemptions, funding support, and easier compliance requirements for eligible startups.
        • Make in India:Provides incentives, subsidies, and promotional support for manufacturing businesses in India

        Tax Benefits

        Companies in India enjoy competitive corporate tax rates, with special deductions and lower rates available for startups and new manufacturing units, under the Income Tax Act.

          Increased Credibility

          Registered companies are seen as trustworthy by investors, clients, and vendors, making it easier to secure funding and partnerships.

            Perpetual Succession

            The company’s existence is not affected by the death or resignation of its shareholders or directors, ensuring long-term stability.

              Ease of Ownership Transfer

              Ownership can be transferred easily by selling shares, making it simple to attract new investors or transition leadership.

                Global Opportunities

                Incorporating a company enables businesses to enter international markets, attract Foreign Direct Investment (FDI), and establish a credible presence globally.

                  Compliance and Legal Safeguards

                  Incorporated companies are required to comply with Indian company law, including annual filings, financial disclosures, and other legal obligations. This structured compliance helps reduce disputes and ensures smoother business operations.

                    Eligibility Criteria for Company Registration

                    Eligibility Criteria for Company Registration

                    As per the Companies Act of 2013 the eligibility criteria for every business entity type varies drastically. Here is a general outline of eligibility criteria for registering your company in MCA.

                    • Registered company should have at least one Indian resident director
                    • Directors should have DSC and DIN
                    • Should not conduct any illegal activities as outlined by the Indian legislature
                    • Directors and shareholders should be legally of Age
                    • Address proof and the Identity proof of the directors has to be submitted
                    • Company should have a unique name.
                    Checklist for Company Registration

                    Checklist for Company Registration

                    Based on the type of company being incorporated the requirements might vary. However, here is a comprehensive checklist for registering your company in India:

                    • Finalise the type of company that you want to register
                    • Select a name for the company as provided under the company incorporation rules of 2014
                    • Have an official address for your firm
                    • Collect all the ID and address proof of the partners
                    • Have at least two shareholders and two directors
                    • Make sure to have one Indian resident director
                    • Finalise the capital required for the company
                    • Draft the objective of the company in and memorandum of association
                    • Apply for DSC and DIN for all the directors if required
                    • Provide address proof and utility bills of the registered office address
                    • Apply for GST if required
                    • Open an current account in the companies name
                    • Appoint an auditor, chartered accountant, and CS if applicable
                    • Get your company TAN and PAN records
                    • Make sure to register your intellectual property like logos and trademarks.
                    Required Documents for Company Registration

                    Required Documents for Company Registration

                    For company registration in India the applicant should provide director and shareholder documents along with the proof of registered office address. Here is a list of the required documents for company incorporation:

                    • Passport size photos of directors and shareholders
                    • PAN card of all the directors
                    • Aadhar, driver license, passport or voter ID of the directors
                    • Proof of residence
                    • NOC of the registered office address
                    • Utility bills for registered office proof
                    • Memorandum of Association (MOA)
                    • Articles of Association (AOA)
                    • Director and Shareholder Details
                    • Digital Signature Certificate (DSC)
                    • Director Identification Number (DIN)
                    Note: The documents may vary based on the type of company you are planning to register. . For more detailed information get in touch with our experts today.

                    Company Registration Process - Step-by-Step

                    Step 1: Choose a Business Structure

                    The first decision is selecting the type of business entity you wish to register. In India, there are six main types:

                    • Private Limited Company (Pvt Ltd): Ideal for startups, offering limited liability protection.
                    • Limited Liability Partnership (LLP): Combines the flexibility of a partnership with the benefits of limited liability.
                    • One Person Company (OPC): Suitable for solo entrepreneurs who want limited liability.
                    • Public Limited Company (PLC): Designed for larger businesses aiming to raise capital from the public.
                    • Sole Proprietorship: Simple structure with full control but unlimited liability.
                    • Partnership Firm: Best for small businesses with shared responsibilities.

                    Step 2: Obtain Director Identification Number (DIN)

                    The Director Identification Number (DIN) is mandatory for anyone who wishes to be a director in the company.

                    How to Apply:

                    • Apply for DIN online via the Ministry of Corporate Affairs (MCA) portal.
                    • Use the SPICe+ form (Simplified Proforma for Incorporating a Company Electronically) during the company registration process.

                    Step 3: Obtain Digital Signature Certificate (DSC)

                    A Digital Signature Certificate (DSC) is required to sign forms electronically on the MCA portal.

                    • How to Obtain: Get a DSC from government-approved Certifying Authorities (e.g., eMudhra, Sify, Ncode).
                    • Documents Required: PAN card, Address proof, and a passport-size photo.

                    Step 4: Choose a Unique Company Name

                    Select a name that aligns with your brand and complies with MCA guidelines.

                    Ensure the name:

                    • Is unique and not similar to existing company names.
                    • Does not infringe on trademarks.
                    • Complies with the Companies (Incorporation) Rules, 2014.

                    Step 5: Apply for Name Approval

                    Once you have selected a name, you need to reserve it.

                    • Use the RUN (Reserve Unique Name) service on the MCA portal.
                    • Have a few alternatives ready in case your first choice is unavailable.
                    • Approved names are valid for 20 days.

                    Step 6: Prepare Memorandum and Articles of Association (MOA & AOA)

                    These legal documents define your company's purpose, structure, and operating rules.

                    • Memorandum of Association (MOA): Specifies the company’s objectives and activities.
                    • Articles of Association (AOA): Defines the company’s internal rules and regulations.
                    • These documents must be signed by directors and shareholders.

                    Step 7: Obtain Consent and Declarations

                    Before filing for incorporation:

                    • Directors and shareholders must provide their consent to act in their roles.
                    • Obtain declarations regarding compliance with legal requirements.
                      1. Form INC-9 for directors' declarations.
                      2. Consent forms like DIR-2.

                    Step 8: File Incorporation Documents

                    This is the most crucial step where all necessary documents are submitted online via the SPICe+ form on the MCA portal.

                    • Documents to Attach:
                      1. MOA & AOA.
                      2. DIN & DSC for directors.
                      3. Address proof for the registered office.
                      4. Identity and address proofs for directors and shareholders.
                    • Additional Forms:
                      1 .Form INC-9 for directors' declarations.
                      2. Consent forms like DIR-2.
                    • AGILE-PRO-S: For registration of GST, EPFO, and ESIC.

                    Step 9: Pay Registration Fees

                    • Fees are based on the authorized capital of the company.
                    • Payment can be made online on the MCA portal.
                    • The fee structure varies depending on the type of company and capital.

                    Step 10: Receive the Certificate of Incorporation

                    Upon successful verification of all submitted documents and payment:

                    • The Registrar of Companies (ROC) issues the Certificate of Incorporation.
                    • The certificate includes a Corporate Identification Number (CIN).
                    • This marks the legal existence of your company.
                    Company Registration Certificate

                    Company Registration Certificate

                    A Company Registration Certificate serves as the official document proving your business's legal existence. Issued by the Registrar of Companies (RoC) under the Ministry of Corporate Affairs (MCA), this certificate not only confirms the incorporation of your company but also grants you the legal authority to operate in full compliance with Indian corporate laws.

                    Types of Company Registration

                    Under the Companies Act of 2013 different types of business entities can be registered. Each and every business entity has its own set of benefits and drawbacks. Here is a complete outline of different business entities and their corresponding information.

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                    Compliance Requirement

                    companies Act, 2013

                    Registration

                    Mandatory

                    Number of Owners

                    2 -200

                    Separate Legal Entity

                    Yes

                    Liability Protection

                    Limited

                    Statutory Audit

                    Mandatory

                    Ownership Transfer

                    Yes

                    Perpetual Existence

                    Yes

                    Foreign Ownership

                    Allowed

                    Taxation Liability

                    Moderate

                    Compliance Requirement

                    High

                    Choosing the Right Business Structure

                    Choosing the Right Business Structure

                    It is crucial to select a proper business structure to avail multiple benefits from incorporation. Based on the type of business structure, compliances vary greatly. For instance, a sole proprietorship company is required to file only the income tax return; a private limited company has to file annual returns and income tax returns with the ROC. You can choose the structure of your company based on the total number of partners or owners involved. Also, the initial investment or initial payment made to start your business also plays a crucial role. You can register your company as a sole proprietorship partnership, LLP, OPC, Section 8 or a private limited company.

                      Cost of Company Registration

                      Cost of Company Registration

                      The overall cost of registering a company in India includes government fees, professional fees, DSC cost, and stamp duty. The cost may vary from one type of company to another. Get in touch with our incorporation experts to know how much it will cost you to incorporate your company.

                        Post-Registration Compliance

                        Post-Registration Compliance 

                        After registering your company in India, it is crucial to follow all the post-registration company compliances. Based on the type of company with which you have registered, the compliances vary. However, performing a statutory audit, filing annual returns, staying abreast of ROC compliance, maintaining statutory registers, and filing your GST returns are some of the post-registration compliances that you should not miss.

                          Annual Compliance

                          Annual filings, Audits, and entity-specific regulatory compliance, such as ROC filings and Tax audits

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                          Accounting & Book keeping

                          Accounting, tax planning, GST compliance, income tax filing, and financial record-keeping aligned with current accounting standards

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                          Other registration

                          MSME, IEC, ISO, FSSAI [Food License], Apeda RCMC, Liquor license, Firearm license

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                          Corporate Secretarial

                          Meetings, Governance compliance, Regulatory filings, Expert board advisors

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                          Secure Your Company Name

                          How to Secure Your Company Name?

                          Selecting the right company name makes a major difference in business strategy. As per law, the company name should reflect the principle activity of the business. At any cost, the company name should not contain words prohibited under the names and emblems act. The company name should be unique and not similar or identical to the names of the existing registered companies. The company name should be registered using the Spice + application on the MCA portal. A maximum of at least two names can be applied to the spice + form. The ROC will approve the company name after verifying the application.Note that the proved name will be reserved for 20 days from the approval date. Within those 20 days, the applicant should file Spice + Form b. If the Spice Plus form part B is not filed within the provided time frame, the application will be rejected, and the process has to be initiated from the beginning.

                            How Vakilsearch Helps in Simplifying Company Registration Process?

                            Vakilsearch stands out for simplifying the company registration process by offering expert guidance, a user-friendly online platform, and personalized solutions. Businesses benefit from our expert assistance in document preparation, transparent pricing, and timely updates on registration progress. Vakilsearch's commitment to legal compliance ensures that businesses navigate complexities seamlessly, receiving post-registration support for ongoing compliance requirements. With a focus on accessibility and technology, we empower businesses to complete the registration process efficiently, allowing them to concentrate on their core operations with confidence in their legal standing.

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                            Company Registration FAQs

                            Non-compliance with post-registration obligations can lead to penalties, legal actions, and even company dissolution. These obligations include filing annual returns, maintaining accounting records, and holding regular meetings as per regulatory requirements to ensure legal and operational compliance.
                            Yes, a foreign national can serve as a director in an Indian company, subject to certain conditions and compliance with applicable laws. They may need to obtain appropriate visas and fulfil directorship eligibility criteria outlined by the Companies Act of 2013 and other relevant regulations.
                            The duration of the company registration process varies based on factors like entity type, documentation completeness, and government processing times. Typically, it takes around 15 to 30 days to complete the registration formalities, though this timeline may vary depending on specific circumstances and regulatory changes.
                            After company registration, various compliances must be met, including tax registrations, statutory filings, and ongoing regulatory obligations. These ensure legal and operational adherence to corporate laws, tax regulations, and other statutory requirements to maintain the company's legal standing and operational integrity.
                            You can verify a company's registration in India through the Ministry of Corporate Affairs (MCA) portal by searching for its name or Corporate Identification Number (CIN). This online database provides access to company details, including registration status, directors' information, and annual filing compliance.
                            You can use Vakilsearch's free company name search tool to see if your desired name is already taken.
                            Yes, registration is mandatory for companies operating in India. The Companies Act, 2013 mandates registration for entities engaging in business activities to ensure legal recognition, accountability, and regulatory oversight, safeguarding stakeholders' interests and promoting corporate transparency.
                            A business name identifies the legal entity, while a trade name refers to the brand name under which business is conducted. The business name is registered with authorities, while the trade name is often used for marketing purposes. Both names may or may not be the same, depending on business preferences.
                            Company registration entails various tax implications, including corporate income tax, Goods and Services Tax (GST), and compliance with tax regulations. These obligations vary based on the company's structure, activities, and turnover, necessitating proper tax planning and compliance to avoid penalties and ensure financial integrity.
                            You can verify the availability of a company name through the MCA portal or the Reserve Unique Name (RUN) service. Conducting a name search helps ensure that the desired name is unique, complies with regulatory guidelines, and is available for registration, streamlining the company registration process.

                            Authors

                            Written by Nithya, Reviewed by Mithra Menon. Last updated on Nov 08 2024, 11:00 AM

                            Mithra Menon excels in Corporate Law Matters and Debt and Money Recovery. She offers assistance in company incorporation both domestically and internationally, along with partnership firm registration. Additionally, she provides advisory services on compliance and LLP registration in India.

                            Nithya Ramani Iyer, a criminologist and writer, serves as the SME and manages communications at Vakilsearch. Drawing from her experience at Seasearch Intelligence and Legal domains, she enriches our content with insightful perspectives.

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