Procedure for Company Incorporation under Companies Act, 2013

INCORPORATION OF COMPANY

SPICe+ and the allied Forms have been introduced by Ministry of Corporate Affairs (MCA) on 23rd February, 2020. This new regime offers a cluster of services under a convenient and single user friendly Dashboard. The same is applicable to all the new Company incorporations w.e.f. 23rd February, 2020.

Section 3 to 22 of the Companies Act, 2013 (herein after called the Act) read with Companies (Incorporation) Rules, 2014 made under Chapter II of the Act (herein after called ‘the Rules’) cover the provisions with regard to incorporation of companies and matters incidental thereto.

Incorporation is a way that a business is formally organized and officially brought into existence.

FEATURES OF SPICE+:

SPICe+ is an integrated Web Form replacing the earlier version of the e-forms, the form is divided in to two parts viz:

Part A-For Name reservation for new companies and

Part B – Offering a bouquet of services viz

• Incorporation
• DIN allotment
• Mandatory issue of PAN
• Mandatory issue of TAN
• Mandatory issue of EPFO registration
• Mandatory issue of ESIC registration, Mandatory issue of Profession Tax registration (only for companies to be registered in Maharashtra, Karnataka and West Bengal)
• Mandatory Opening of Bank Account for the Company
• Allotment of GSTIN (if so applied for)
• Allotment of Shops and Establishment Registration Number (Only for Delhi Location)

Step-By-Step Process for Incorporation of Company in India

Step 1: Check The Name Availability

1. MCA Master Data

2. Public Search for Trademark

Points to remember while applying for a Name:

Chapter II The Companies (Incorporation) Rules, 2014

Rule 8. Names which resemble too nearly with name of existing company.

MCA checks three important factors while approving the company name:

1. The name should be unique, and no other company (public or private) should be using that name or having any trademark of the same.

2. The name shouldn’t be offensive.

3. The name shouldn’t give an impression that it’s linked with the Government.

 Step 2: Reservation of Company’s Name under SPICe

 The foremost step in the company registration process is reserving the name of the company. There is only one way to go for it: SPICe.

The service SPICE+ is available under the Company services option available beneath MCA Services which offer TWO options viz. PART-A & PART-B.

PART-A: ONLY TO RESERVE THE NAME OF THE COMPANY

⇒ Login to MCA Portal, under Company Services, click on SPICE+

⇒ A screen will appear, showing 2 options i.e NEW APPLICATION & EXISTING APPLICATIONS, in case new name is to be applied then click on NEW APPLICATION else to work on the saved applications click on EXISTING APPLICATIONS.

⇒ On clicking New Application, SPICE+ PART-A (Name Reservation) gets enabled, which then requires the following categories to be selected:

**PARTICULARS OF PROPOSED NAME (2 OPTIONS)

**ATTACHMENT: DO ATTACH MAIN OBJECTS OF THE COMPANY IN PDF FORMAT ALONG WITH OTHER SUPPORTING DOCUMENTS. ANY NOC IF REQUIRED.

Once MCA approves a company name, it’s reserved for 20 days within which the applicant must complete all the remaining steps required for company registration.

The applicant must also select the names of the Directors of the company. For a private limited company, at least two names of the Directors need to be provided in case of private company.

Rule 9A of the Companies (Incorporation) Rules, 2014-Extension of Reservation of name in certain cases

Upon payment of fees provided below through the web service available at www.mca.gov.in, the Registrar shall extend the period of a name reserved under rule 9 by using web service SPICe+ (Simplified Proforma for Incorporating Company Electronically Plus: INC-32), upto:

(a) forty days from the date of approval under rule 9, on payment of fees of rupees of one thousand rupees made before the expiry of twenty days from the date of approval under rule 9;

(b) sixty days from the date of approval under rule 9 on payment of fees of rupees two thousand made before the expiry of forty days referred to in clause (a) above;

(c) sixty days from the date of approval under rule 9 on payment of fees of rupees three thousand made before the expiry of twenty days from the date of approval under rule 9:

However, the Registrar shall have the power to cancel the reserved name in accordance with sub-section (5) of section 4 of the Companies Act. 2013.

New ‘Extend’ functionality has been introduced as part of SPICe+ Part A in line with Rule 9A ‘Extension of reservation of name in certain cases’ of the Companies (Incorporation) Third Amendment Rules, 2020 with effect from January 26, 2021.

STEP:3 Apply for Digital Signatures (DSC) Of First Directors Cum Subscribers of Proposed Company

Digital Signature Certificates (DSC) are the digital equivalent (i.e. electronic format) of physical or paper certificates. Certificates serve as proof of identity of an individual for a certain purpose. Likewise, a digital certificate can be presented electronically to prove your identity, to access information or services on the Internet or to sign certain documents digitally

Documents Required for applying DSC- ·

• Copy of Self Attested PAN Card & Aadhar Card/Passport/Voter ID ·
• Valid Mobile No
• Valid Email ID
• Passport size photograph (latest)

STEP:4 AFTER NAME APPROVAL FILL THE PART-B OF SPICE+

Details shall be filled in the PART-B of SPICE+ and in all linked Forms being SPICE-MOA, SPICE-AOA, AGILE PRO, URC-1 & INC-9 (as per the applicability).

Now, the applicant gets an option of “PROCEED FOR INCORPORATION” if the same is selected then, PART-B gets enabled, comprising various segments each having an option of “SAVE AND CONTINUE” And on clicking Existing Application option, the applicant can view Application No. and Proposed/Approved name of the Company and proceed further for filling Basic Company Details.

 Fill web form after login on MCA- SPICe+ Part B

DETAILS REQUIRED TO FILE THE FORM:

1. Nature of the business like manufacturing firm, Service Provider, etc.

2. Authorized Capital and Paid up Capital

3. Address of Registered office of Company (Latest electricity bill or any other utility bill in the name of owner Conveyance / Lease deed/ Rent Agreement etc. along with rent receipts/NOC from owner)

4. Email ID of Company

5. Details of Subscribers and directors of Company

6. Shares held by each subscriber

7. Occupation type: Self Employed/ Professional/ Homemaker/ Student/ Serviceman (Anyone)

8. For PAN AND TAN (Area code, AO type, Range code. AO no.) (NSDL Tax Information)

9. Business/ Profession code

10. Name, address, membership no., COP No., Associate/Fellow of Professional (CS, CA, CMA, Advocate)

*All directors Details (All documents should be self-attested copies by respective directors)

*For Proof of Identity: Driving License, Voter ID card, Passport (Anyone)

*For Address Proof: Bank Statement, Electricity Bill, Telephone Bill, Mobile Bill. (Anyone, not older than 2 months)

* Maximum 3 (Three) DIN can be applied through SPICe+ form

* Latest electricity bill or any other utility bill in the name of owner Conveyance which should not be older than two months.

ATTACHMENTS MANDATORY WITH SPICE+ PART B

• Declaration by the first director(s) and subscriber(s)
• Proof of Identity as well as the Residential address of subscribers
• Proof of Identity and Residential Address of Directors
• Address of Registered Office of Company (Latest Electricity Bill or Any Other Utility Bill in The Name of Owner Conveyance/ Lease Deed/ Rent Agreement Etc. Along with Rent Receipts/NOC from Owner)
• Copy of utility bills not older than two months
• NOC for use premises for registered office of proposed Company from owner and person whose name mentioned in utility bill;
• The interest of first director(s)in other entities
• Optional attachments (if any)

STEP:5 SPICe+ MOA Memorandum of Company (Section 4 Company Incorporation Rule 2014)

This E-form is generated when all details in SPICe+ part B is filled (Except Section 8 Company)

Under Section-4(6) of The Companies Act, 2013, Memorandum of Association must be in a respective form prescribed in Table A, B, C, D and E of Schedule-I.

Memorandum of Company

1. Main Objects to be pursued by the company on its incorporation and Matters which are necessary for furtherance of the objects

2. Subscribers Details

3. Professional Details

4. Digitally Signed by each subscribers and Professional

  STEP:6 SPICe+ AOA (Section 5 Company Incorporation Rule 2014)

This E-form is also generated when all details in SPICe+ part B and MOA is filled.

Articles of Company

1. Fill this E-form as per definition of Company whether it is Private, Public or OPC.

2. First Directors of the Company

3. Subscribers Details

4. Professional Details

5. Digitally Signed by each subscribers and Professional

STEP:7 INC-9

This E-form is also generated when all details in SPICe+ part B, MOA and AOA is filled it is auto generated form no need to fill any details in it.

1. Digitally Signed by each subscribers

STEP:8 AGILE PRO

Application for Goods and services tax Identification number, Employees State Insurance Corporation registration plus Employees Provident Fund Organization registration, Profession Tax Registration and Opening of Bank Account.

For GST (Option to Select Yes or No)

1. Primary Business activity

2. Exact nature of work / business

3. Work Sub-category

4. HSN/ SAC Code

5. Director details to be entered (for OPC shall be 1, 2 in case of private company, 3 for public limited company.

6. Email ID of Director and Mobile no (OTP is send by MCA in both mail and mobile no. separately for verification)

7. Police Station

8. Authorized Signatory for GSTN (Either of the following document can be attached. Letter of Authorisation / Copy of Resolution passed by BOD / Managing Committee and Acceptance letter)

For Bank Particulars. 1. Select Bank Name (Mention name of the bank in which Company want to open Company account)

ATTACHMENTS MANDATORY WITH AGILE PRO

1. Specimen Signature Card (Signed by All Directors)

2. Proof of Address and Identity of Any One Director

3. Passport Size Photo of All Directors

STEP: 9 FINAL STEP- UPLOAD

1. Download the Web Form

2. After Affixing DSC in SPICe+ Part B and all the linked forms as applicable, user can click on upload e-form option and upload SPICe+ Part B along with all the linked forms by Login on MCA (Pay Fees Electronically)

3. On Successful uploading, SRN (Service Request Number) is generated for user to make payment.

4. On Successful Payment SRN status will be displayed as “Processing”.

**After verification of Forms of Incorporation CRC will issue Certificate of Incorporation and create master data of Company.

This form can be used for the following purposes:

• Application of DIN (upto 3 Directors)
• Application for Availability of Name
• No need to file separate form for first Director (DIR-12)
• No need to file separate form for PAN & TAN
• No need to file separately for GST.

COMMENCEMENT OF BUSINESS

As per Section 10A read with Rule 23A of the Companies (Incorporation) Rules, 2014, every company incorporated after the commencement of the Companies (Amendment) Act, 2019 and having a share capital shall not commence any business or exercise any borrowing powers unless:

(a) a declaration in form INC-20A is filed by a director within a period of one hundred and eighty days of the date of incorporation of the company in such form and verified by a CS/CA/CMA in practice, with the Registrar that every subscriber to the memorandum has paid the value of the shares agreed to be taken by him on the date of making of such declaration;

(b) The company has filed with the Registrar a verification of its registered office in form INC-22 as provided in sub-section (2) of section 12 of the Companies Act, 2013;

(c) If any default is made in complying with the requirements of this section:

• Company shall be liable to a penalty of fifty thousand rupees and
• Every officer who is in default shall be liable to a penalty of one thousand rupees for each day during which such default continues but not exceeding an amount of one lakh rupees; and

PRE-CAUTIONS TO BE TAKEN BY PROFESSIONALS

1. Obtain engagement letter from subscriber.

2. Verification of original records pertaining to registered office.

3. Ensure all attachments are clear enough to read.

4. Ensure registered office of the company is functioning for the business purposes of the company.

5. Take a declaration to the effect that all the original documents have been handed over after incorporation. Since as per section 7(4) copies all documents/information as originally filed should be preserved at the registered office of the company, therefore a professional should take a declaration while handing over the incorporation documents.

6. MCA Circular 10/2014: – According to this circular ROC/RD in case of omission of material fact or submission of false/incomplete/ misleading information can after giving opportunity to explain refer the matter to e-governance division of MCA, which in turn may initiate proceedings under section 447 and/ or ask the respective professional institute to take requisite disciplinary action.

IMPORTANT POINTS:

• Form Size Should Not Exceed 6 MB
• All directors Details (All documents should be self-attested copies by respective directors)
• For Proof of Identity: Driving License, Voter ID card, Passport (Anyone)
• For Address Proof: Bank Statement, Electricity Bill, Telephone Bill, Mobile Bill. (Anyone, not older than 2 months)
• Specimen Signature Card
• FEES & RESUBMISSION Criteria to remain same.
• Incorporations after 23th February, 2020 can be done through this route only.
• Modifications can be done to SPICE+ even after generating PDF and Affixing DSC’s by editing the Saved Web Form Application but only till 5 attempts, after that the whole process will have to be restarted.