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How to register a company in India (Private Limited Companies)

We see many youngsters taking the Entrepreneurial route and not only that many NRI’s are returning back to India with aim to start their own company. In this how to guide I am going to detail on how to register a company in India and share information on how to start a private limited company in India. As per the companies act 1956 PRivate limited companies need to have minimum of two directors and maximum of any number of directors. Identify the initial set of directors who will be floating the company together.It is very important when you start a company you are partnering with most trusted person’s who is going to be with you during the highs and lows of the company. Discuss with your partner(s) on the vision and mission of the company and make sure they are synched up. The whole registration process of company can done by individuals themselves but I would suggest to consult with company secretary/chartered accountants who will speed up your registration process for a nominal fee for their consultancy services.

how-to-register-a-company-in-india-1Source – DeviantArt

How to register a company in India?

Follow the below steps to register a Private limited company in India

1. Identify the directors of the company – (Minimum 2 and Maximum no restrictions)

2. Apply for Director Identification Number DIN for all the directors. If Directors have DIN this step can be skipped. DIN is a unique number provided to directors of the company and needs to be applied online by filing eForm DIN-1.  The cost to get DIN number is Rs.100. Visit here to apply for DIN

3. The Director’s need to have Digital Signature.Digital Signature can be obtained from  any third party companies which are approved to provide Digital Signature. Once you have obtained the Digital Signature the same has to be registered with ROC. To Register your DIN Visit here

4. The next step is to register a company name. You need to have a set of six names so that if the first priority is not available the next option will be checked for. During this process they will check if the name you have applied for is already taken or whether it is available.  Name Registration can be done online by submitting Form1A. Download the form here and carefully fill in the details and click Submit.

5. The next step is to Incorporate the company. To Incorporate the company you need to first formulate the Memorandum of Association Articles of Association  which details the main purpose of the company, the areas of services/focus,share capital money,directors involved etc will be listed in this document.A minimum of Rs.1,00,000 as Share Capital is required to start the company and these shares will be split amongst the directors.You will also need to pay Stamp duty for these company documents which can be done online also along with eFiling. Once these documents are ready you need to submit the Form1.

6. When you file Form1 along with it file Form 18 using which you will register the register office of the company and Form32 using which you will appoint Managing Director, Secretary etc.Director.During the filing of Form 1 consent document of initial directors is required. After submission the documents will be reviewed and approximately the status of application will be known in a week’s time

7. Once you get the Company Incorporated open a current account on company’s name by submitting the approved company letter along with board resolution.

8. Next apply for PAN by filling Form49A and TAN by filling Form49B for the Company

When you have finished all the steps and received approvals you can then start your actual operations . In this How to register a company  guide I have compiled all the steps to make the registration process more easier. Best Wishes on your new entrepreneurial journey and do let me know in comments if you have any suggestions or improvements for this guide

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About Jayashree J

I am Jayashree Software Engineer, had a brief stint in software industry.I blog about Technology,How To Guides,Social Media,Tips & Tricks,Product Reviews (Mobile Apps, Desktop Apps),Website Reviews,Latest Trends.

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19 comments

  1. Hi Jayashree
    Good to see that you have mentioned short and informative methods to just follow and register a Private limited company in India.
    Good job.keep it up.

  2. Hi Jayashree,

    It is really a good read. Most of my friends are trying to establish companies of their own and they may need information like this. I will suggest the article to them. Thanks.
    Kushal Biswas recently posted…Online Personal Branding – Tips for Job SearchersMy Profile

    • Thanks Kushal for stopping by. Appreciate your feedback. I agree that many who want to start their own company scramble for information and I hope this article will help them. Keep visiting my blog and give your valuable feedback.

  3. thank you very much for this article this is very important for the newbies……

  4. Hey Jayashree,

    This is an highly informative article. Many people pay for this information and you share it for free.
    Thanks for sharing it.

    Regards
    Ritul Gangwar
    Ritul Gangwar recently posted…Coursera app brings its free online classes and lectures to AndroidMy Profile

  5. Hey Jayashree

    While I continue working for a private company, can I setup a company? I being one of the director? Will any company HR rules agree for this?

    Regards
    Raja

    • Hello Raja Sekhar – Thanks for stopping by and posting your query. I am really not sure what your company terms are and it varies from company to company. If there is no any direct conflict of interest you can setup but you can directly check with your HR to check if there will be any conflict to clarify the doubts.

  6. Precise and to the point. What I need to know about is the share capital. You wrote that a min of 100,000 is needed for the startup? But, who asks for it? Do we have to deposit that much sum at the MCA? Or, is it that we are required to show that much amount on the bank account?

    • 1. Who asks for INR 100,000? — For any business to succeed, and keep the interests of the other stakeholders, promoters are expected to invest an amount. That way, the founders understand the importance of the business. This being the reason, a minimum level of capital is earmarked by the legal entity called Company’s ACT 1956. This means, as per law, as a promoter/founder, you will need to invest an with an minimum amount of INR 1 Lakh and also provide the profit-loss sharing between the directors.

      2. Deposit that sum with MCA? — No. It should be with your bank and provide the proof from the bank about the deposit details.

      I hope this clarifies.

  7. Thanks for sharing this blog.Such its very useful to new who are intersting in grow up their own business.
    I found so many things in this blog.

  8. Hi J.J.

    A perfect article with sufficient info

    I have the following doubts if you can answer them

    1)Why a Minimum of two Directors are required? If somebody wants to start a Company on his own?

    2) What is the approximate duration it takes for this Process

    3) Is there any additional application or process required (For Eg, if someone wants to start a company which works in the field of R&D, do they require to get ay additional licences or permissions to start it) or just registering a company is fine irrespective of the business it would be involved in?

    Would appreciate your reply.

    Thanks again for the article

    Rohan

    • 1. For any sole proprietorship, one person could start a company. the rules and regulations for the same are different. But for starting a Private Limited Company, you need minimum 2 directors as per Company’s ACT 1956

      2. Earlier it used to take months, now because of e-governance if you have all the supporting documents mentioned in this post (also please refer MCA website prior submitting the documents for relevance), it should be days. It again depends on the nature of business, what other benefits you are trying to avail, etc.

      3. Yes. all Statutory and regulatory procedures have to be followed if you need to open an R&D business. Should you focus on Medical domain, there are strict procedures to be followed. For IT, it is just an branch of Organization Structure.

      Hope this helps!
      -Dev

  9. Hi,
    I would like to know the process of establishing a new branch in India. We do have a resisted company at USA. Should I fallow the same process which you mentioned above? Or is there any other process which I need to process? Please let me know.

    Thanks,
    Suman

    • Hi Suman – The process remain same. It is just that you will need to mention about your parent company and how your accounts will be maintained.

      Hope this helps!
      -Dev

  10. Can any one say how much time it will take for the whole process? And any good consulting service to contact for this work to be done.

    Thanks in Advance

  11. What is the difference between DIN-1 and DIN-3 form. Both look to be same!

  12. Private limited company (13,000 – 15,500; Depends on the state where the business is being registered, and the number of directors)
    The minimum amount of capital required is Rs 1,00,000
    The procedure is as follows.
    Get you Digital signature certificate (1/2 years validity)
    Apply for your DIN number
    Get the name of your company approved and reserved draft the articles of association and Memorandum of association. File the documents with the registrar of companies.

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