Private Limited Company registration is the most popular form of a ‘legal structure’ for all businesses in India. This type of company offers limited liability for its shareholders with certain restrictions placed on the ownership. An LLP has partners, who own and manage the business. Whereas in private limited company registration, directors may be different from shareholders.
The Ministry of Corporate Affairs (MCA), introduced the SPICe form (Simplified Proforma for Incorporating a Company Electronically) or Form INC-32 that helps incorporate a company with a single application for reservation of name, incorporation of a new company, and application for allotment of DIN.
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1. Meaning of Private Company
“Private Company” means a [company having a minimum paid-up share capital (Omitted)] as may be prescribed, and which by its articles: –
(i) restricts the right to transfer its shares;
(ii) except in case of One Person Company, limits the number of its members to two hundred:
Provided that where two or more persons hold one or more shares in a company jointly, they shall, for the purposes of this clause, be treated as a single member.
2. Law governing the process of Incorporation of the Company
In general, sections 4, 7, 12, 152, and 153 of the Companies Act, 2013 read with rules are applicable in the incorporation process of the company.
3. Point to be kept in mind before incorporation of Private Limited Company
a. The proposed name should not fall in the ambit of undesirable names specified in Rule 8 of Companies (Incorporation) Rules, 2014.
b. There must be at least 2 subscribers to the memorandum and the maximum number of members allowed is 200 members.
c. Minimum number of Directors required is 2 Directors with a maximum limit of up to 15 Directors. But a company may appoint more than 15 directors after passing a special resolution in a general meeting.
d. Every company shall have at least one director who has stayed in India for a total period of not less than 180 days in the previous calendar year as per section 149(3) of the Companies Act, 2013.
4. Private Company Incorporation Process
a. Obtaining Director Identification Number (DIN) and Digital Signature
The first step for the registration of a Private Limited Company is to obtain Director Identification Number (DIN) for the proposed Directors in the Private Limited Company. (Note: Maximum three Directors are allowed for using this integrated form for filing application of allotment of DIN while incorporating a company other than a Producer company. In the case of a Producer Company, a maximum of five directors are allowed to apply for allotment of DIN).
And Digital Signature of the Directors and all subscribers to the memorandum of Private Limited Company is necessary.
b. Name reservation of Company
For all kinds of information and process regarding the name reservation of the company, you can get through our earlier written article, and the link for the same is: –
https://taxguru.in/company-law/reservation-process-company.html
c. SPICe Form- Company Registration Procedure
This form is segregated into two parts:
• Part -A: Name Application
The user has the flexibility to apply for Part A & Part B together. He should do that only when he is sure of the name availability for which he has applied. If he is unsure, he must apply for Part A separately as mentioned above, and get the name approval. Thereafter, go ahead with the process of incorporation.
• Part B: Procedure for incorporation
Once the name applied in Part A gets approved, the details automatically get prefilled in Part B in all the linked forms. Then, fill in all necessary details in all linked forms such as AGILE-PRO, SPICe+ MOA, SPICe+ AOA, URC-1 (applicable in the case of conversion) INC-9 (as per applicability).
Companies have to apply for the bank account also through this form only and You also have to take mandatory registrations like EPFO, ESIC, Professional tax through this form only. Additionally, you can get GST registration through the same form, but it is not necessary.
d. Mandatory Attachments
• Directors and subscribers KYC documents such as Aadhar Card, Pan Card, Proof of address (not older than 2 months), photo, passport, etc.
• Director Consent through form DIR-2
• Registered Address proof such as Rent Agreement, Property Tax Receipt, NOC, and Bill (Not older than 2 months).
e. Pre-scrutiny and Submission of the Incorporation Forms
In the end, after everything is done, pre scrutinize the form. Once it is successful, submit the form. After that, download the Spice+ Form and all other forms linked to Spice, affix the DSC, and upload the same over the MCA portal.
f. Resubmission/ Approval
On approval of SPICe forms, the Certificate of Incorporation is issued with PAN as allotted by the Income Tax Department. An electronic mail with Certificate of Incorporation as an attachment along with PAN and TAN is also sent to the user. Further PAN card shall be issued by the Income Tax Department.
On the other hand, the authority can raise queries and send forms for resubmission. Then, you have to provide all asked information, clarification, and documents. Then again, download the updated Spice+ Form and other linked forms, affix the DSC, and re-upload the same over the MCA portal.
1. Is the Opening of a Bank Account mandatory for all companies incorporated through SPICe+?
Ans. Yes. All new companies incorporated through SPICe+ (w.e.f 23rd February 2020) would also be mandatorily required to apply for opening the company’s Bank account through the AGILE-PRO linked web form.
2. Is it mandatory for every subscriber and/or director to obtain DSC now?
Ans. Yes. In case the number of subscribers and/or directors to eMoA and eAoA is up to twenty and all such subscribers and/or directors have DIN/PAN, it shall be mandatory for each one of them to obtain a DSC.
3. What is the sequence of uploading linked forms to SPICe+?
Ans. SPICe+—->e MOA[if applicable] —-> e AOA[if applicable] —-> URC-1[if applicable] —->AGILE-PRO[mandatory in all the cases] —->INC-9[if applicable].
4. What if there are more than seven subscribers to MoA and AoA?
Ans. In such case, the SPICe+ form shall be filed with MoA and AOA as attachments in case of more than seven subscribers.
5. How many resubmissions are permitted for SPICe+ forms?
Ans. Maximum. Two resubmissions are permitted.
6. What is the maximum upload size of SPICe+ forms?
Ans. 6 MB for each of the PDF forms after affixation of all DSCs.
7. What kind of Fee liable to be paid along with the SPICe+ form?
Ans. The amount of fee varied on the various factor such as Authorized Capital Amount, Number of Subscribers, Location of the company, etc as well as stamp duty structure differs from state to state. But, mainly 5 kinds of Fee liable to be paid along with the SPICe+ form may be classified as follows:
• Filing fee for SPICe+ form
• Registration fee for MoA
• Registration fee for AoA
• Filing fee for URC-1 (if applicable)
• Stamp duty as applicable for SPICe+/ MoA/ AoA
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