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The INC-29 promises to tremendously shorten company registration – to 48 hours, if you believe the Ministry of Corporate Affairs (MCA) claim. The form rolls 5 separate application forms, for DIN allotment, name reservation, incorporation, PAN & TAN, as well as ESIC registration, into one. If handled systematically, this change could go a long way in easing the hassles of entrepreneurs while registering private limited or one person companies. In this post, we'll discuss all the changes the INC-29 brings along and the potential concerns going forward.
So, under the old process, company registration involved the following 6 steps:
1. DSC Application for directors 2. DIN Application for directors 3. Company Name Approval and Search 4. Final Incorporation Filing 5. PAN & TAN Application 6. ESIC Registration
With the INC-29, the procedure has been changed to:
1. DSC Application for 1 director
2. DIN Application for directors, Company Name Approval and Search, Final Incorporation Filing, PAN & TAN Application, ESIC Registration
An impressive 4 fewer steps. We'll now examine the new procedure in greater detail. Should you have any questions, do fill in the form at the top of the page and we'll clear all your doubts.
Obtain a DSC
To file INC-29, only a single director needs to have a Class-2 Digital Signature Certificate (DSC), which is needed to sign electronic documents. To get one, all you need is a self-attested copy of the director's PAN card and address proof (latest utility bill, passport, driver's license of voter's ID). This can be completed in 2 days.
Get Papers in Order
Under the old procedure, there was ample time to get the various documents in order during the incorporation process. While filing the DIN application, you could narrow down on a list of names; during name approval, you could have the Memorandum and Articles of Association (MoA and AoA) prepared, get the no-objection certificate from the landlord, etc. This is no longer the case. As all the documents are filed with the INC-29, you need to have all the attachments ready at the same time. Here are the documents you'll need:
1. MoA and AoA
2. Copy of Rental Agreement (along with NOC from owner)/Sale Deed
3. Latest Utility Bill
4. Affidavit from director and shareholders
5. Copy of PAN card, Identity and Address Proof for DIN for up to 3 directors
Filing of INC-29
As mentioned above, only 3 directors can apply for a DIN. If your company has more than 3 directors, they may apply for their DINs separately.
One problem that may not be immediately apparent if you've never formed a company before is that it asks for just 1 company name. Before INC-29, you had the option of submitting 6 along with the order of priority – and the Registrar would find reason reject all of them.
So now that you can state only 1 preference, please ensure that you strictly follow the naming guidelines of Registrar as discussed below. What makes this even more important now is that the INC-29 allows only a single resubmission, as compared to 2 under the earlier procedure.
Do contact us if you need any assistance in this regard. Our representatives are fully equipped to guide you through the process and will ensure your forms are correctly filed.
The government has said that the INC-29 can be approved in 48 hours. This seems unlikely, given that the form combines 5 forms, but doesn't drop any old process. Nonetheless, the processing time is sure to be much shorter. So while there's no guarantee on the time it will take, you should be happy that the approval of the INC-29 will alone get you the incorporation certificate, company PAN, TAN and ESIC registration.
Picking a Company Name
You need to first ensure that your name has not already been taken. This can be done by checking the MCA website. If you are disappointed that a preferred name is taken, do remember that the name of your company doesn't have to be your brand name. However, if you're going to register the brand name, also check if it has already been trademarked at http://ipindia.nic.com. If it has been trademarked, you would need a no-objection certificate from its owner to have it approved as your company's name.
Secondly, you need to comply with the MCA guidelines. You can do so by ensuring that the name has a unique component and a descriptive component.
Unique Component: This is the part you coin. It could be a combination of the directors' names or last names (Ravi + Aravind = Aravi), a combination of two words (InfoSys, for example) or just a unique word (whether or not it is in a dictionary).
Avoid: Abbreviations, adjectives and generic words are rejected. So 'ABC Software', 'Best Software' or 'National Software' would not be accepted. Also read up on undesirable names and guidelines on the use of the words 'bank', 'stock exchange' and 'exchange'. These would need approval from RBI or SEBI.
Descriptive Component: This describes your business. If you're in the software business, pick Software or InfoTech. If you're starting a publisher, pick publishing. Avoid: Being unclear, of course. If you're in the IT Services business, don't just use services; pick IT Services.
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