Understanding Company Registration Procedure in India

Registering a company in India is easy with legal assistance. You need to furnish some mandatory identity documents. Once your company is registered, you have to follow post company incorporation compliances to avoid fines and penalties.

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Why should you register for a Private Limited Company?

Registering a Private Limited Company is the right choice, as it facilitates taxation benefits,credibility, business expansion, and quicker sanction of business loans.


We will help you register your directors with the MCA (Ministry of Corporate Affairs)

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We will help you pick the right company name

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We will draft your company's constitution (MoA and AoA)

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Understanding Company Registration Procedure in India

According to some reports, India is a country having the second highest number of unregistered businesses in the world. However, the number of registered companies have steadily been increasing with the total being 17.95 lakh as per the data by the Ministry of Corporate Affairs.

Starting with the baby step of shortlisting your business idea, doing in-depth research and development of the market trends, developing the product or service, looking out for finances, charting the rough business plan, the final step towards achieving your entrepreneur dream is company registration.

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Types of business entities

Companies can be registered as private limited, sole proprietorship, partnership, limited liability, one person company, etc and each has its own guidelines. For instance, all private limited companies and LLPs are governed by the Companies Act 2013 and are registered under the Ministry of Corporate Affairs. Registering a business was once a tedious process and a costly affair involving legal complexities. But by seeking professional assistance, it is now easy and affordable and moreover comes with a whole lot of benefits.

Private limited company

This is one of the popular types of registration and it is widely chosen as it offers greater flexibility, limited liability and has a great possibility for expansion. A private limited company is incorporated under the Companies Act 2013.

Sole proprietorship

Also called as a sole trader company, in this type of business entity only one person owns and takes care of the business operations. It is simple to set up, no capital is needed. There are no benefits of limited liability and no legal distinction between the business and its owner.


As the name suggests, a partnership company is managed by two or more partners. A partnership deed is first crafted wherein all the roles and responsibilities of the partners and other terms and objectives are set out. Some benefits of this are it is easy to start, minimal compliance and relatively inexpensive.

Limited liability partnership

Limited Liability partnership or LLP was first introduced according to the LLP Act 2008. It provides owners with minimum liability and is easy to maintain. One of the drawbacks of LLP is that it cannot easily employee accommodate stock options and does not attract investors.

Here are the top five reasons why registering a company is good

Opening of business bank account:

A current bank account is the basic requirement and an important asset of any business be it a sole proprietorship, partnership, private limited, etc and serves as legal proof of existence. While opening a business bank for a private limited company in the respective state, copies of the incorporation certificate and memorandum of association need to be submitted Whereas no such documents are needed for sole proprietorship and partnership companies.

Easy transfer of ownership:

At some point of time, there does arise a need to transfer the ownership of business and in such cases, it becomes more complex for unregistered business entities. Sole proprietorships cannot be sold and only the transfer of ownership of assets can be done. On the other hand, the transfer of shares and business-related documents are easy for the entities that are registered as private limited company or LLP.

Limited liability protection:

Any business is prone to incur a loss and one of the main advantages of registration is that it offers limited liability protection and hence the business promoters are not liable for the liabilities of the business. There is no way of losing personal property.

Secure funding

In order to move your business forward, seeking and securing investment cannot be missed out. Funding could be in the form of debt or equity. Company incorporation facilitates the funding process well and attracts attract more potential investors. Also, most banks and financial institutions prefer to fund registered entities rather than unregistered entities.

Brand recognition

A registered business is the biggest asset and has the prospects of being passed down as an inheritance to generations or it could be sold to new breed entrepreneurs. Registering a business is required for sustainability.

How to register a company?

Now that you know the importance and benefits of company registration, it is always best to seek professional assistance who can guide you throughout the process and the pros and cons that each registration holds on. Company registration in India is done is done with the MCA/RoC as per the Companies Act 2013.

The process of INC-29 Company Registration Procedure in India

Why Vakilsearch

15 Working Days

Just tell us a few details about your business and submit the documents and we’ll begin the process. Within 20 working days, you’ll be ready to operate as a private limited company – without leaving home.

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We make your interaction with government as smooth as is possible by doing all the paperwork for you. We will also give you absolute clarity on the process to set realistic expectations.

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Our team of experienced business advisors are a phone call away, should you have any queries about the process. But we'll try to ensure that your doubts are cleared before they even arise.

Find Out More About The Company Registration with MCA.

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