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What is Private Limited Company Registration?

Private Limited Company is one of the most common types of company registration in India, It is the most widespread and most popular type of corporate legal entity. The Private Limited Company registration is governed by Companies Act, 2013.

The word "Private Limited" must be added at the end of its name by a Registered Private Limited Company.

In India, more than 1.5 Million company registration has been done by the MCA. In general, Private Limited Company registration has more credibility than LLP or OPC

Unique features of the private limited Company Registration are as follows:

  • Limited Liability protection to shareholders
  • Ability to raise equity funds
  • Statues being a separate legal entity
  • Perpetual Existence

These features make it most recommended the type of business entity for many small and medium sized business. Generally, new Start-ups and growing businesses choose to private limited company registration in India.

Management and shareholder requirement for Private Limited Company Registration

1. How many directors/shareholders required for company registration?

Directors Shareholders
Minimum: 2 Minimum: 2
Maximum: 15 Maximum: 200

As per the requirement under Companies Act 2013, every private limited Company shall have at least one Director whose stay in India is not less than 182 days for a total period in the previous calendar year.

2. What should be the minimum Share Capital of company registration?

For Company registration, you have multiple choice thought company registration as the private limited company requires no minimum paid up capital. However, in general, entrepreneur keeps Rs. 1 lakh rupees or such higher paid up Capital as may be prescribed.

Advantages of Company Registration in India

Ease Business in India

The company can be registered as OPC or Limited Liability Partnership or Private limited. Private limited company has been always considered as No. 1 choice by the startup founders. Here are the benefits of Private limited company registration.

Separate Legal Entity

Under Companies Act 2013, a private Limited Company registration is a distinct Legal entity. Hence, the members are not personally liable for companies debts.Thus, it can open Bank account in its own name, sue another person etc.

Limited Liability

Business needs to borrow money. In a Private Limited Company registration, only the amount invested will be lost and the personal property of directors won't be attached in case of liability arises. Limited Liabilities are given to shareholders

Perpetual Succession

It simply means un interrupted existence I.e. it is unaffected by death or casual vacancy or other departure of any member etc. the entity continues to exist forever.

Easily Transferability

Only by means of transferring shares the ownership of the company gets treasured easily. The consent of other shareholders may be required to have such effect.

Minimum Tax burden

Govt also provides certain Tax Benefits and tax exemptions to companies, which are not available in general course. Such incentives are based on their area of operations.

What is the Procedure for Private Limited Company Registration?

1. Applying for DSC and DIN

2. Company name Reservation

3. MOA and AOA

4. Submit Spice form i.e. INC 32 for Approval

5. Company PAN and TAN

Documents Required for Private limited Company Registration

From Directors and Shareholders

  • Scan copy of PAN or passport(self-attested)
  • Passport sized photograph (self-attested) etc.
  • Copy of Address proof(self-attested)
  • Notarized rental Agreement if any rental property used for the same etc.

For Proposed Registered Address (Residential/Commercial)

  • NOC from owner if applicable
  • Copy of electricity bill/Telephone Bill/Bank statement

What is the difference between Private Limited Company Vs? Public Limited Company

Description Private Company Public Company
Share Capital Minimum: Rs. 100000 Thus now it can be floated with any amount of share capital Minimum: Rs.500000
Members Minimum:2
Maximum: No Limit
Name Last word "Private Limited" Last word "Public Limited"
Public Offer No Yes
Stock Exchange No Listing For public offer, it is to be listed on stock Exchange
No. of Director Minimum: 2
Maximum: 15
Ease of Investment Easy to accommodate Difficult a compared to Private Company
Recommended for Start-up and Growing Company Big Company engaged in professional services
Protection Limited Liability Yes Yes
Venture Capital Fund Yes Yes
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Company Created
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