1. PRIVATE COMPANY

The unlimited liability feature of a sole proprietorship form of business resulted in people forming partnerships, but even that proved to be too inadequate and risky. This is when the concept of companies emerged, and private companies form of business have several exemptions that public companies do not enjoy.

Private Limited Company is the most prevalent and popular type of corporate legal entity in India

 For Registering a private limited company gives protection to the personal assets, financial assistance, access to more resources and greater tax cuts

Formation of Private Companies in just 3 Simple steps:

  • 2 Names of the Company in order of Preference
  • Docs for Directors :-
    • PAN Card / Adhaar Card / Passport/ DL / Voter Id Card
    • Bank Statement / Electricity Bill / Mobile Bill
  • Docs for Office Address :-
    • Electricity Bill / Mobile Bill / Water Bill
    • Rent Agreement / Sale Deed

For Registration of Private Limited Company https://corporateraastaconsulting.com/contact-us/

2. ONE PERSON COMPANY (OPC)

OPC or One person company is one of the easiest forms of corporate entities to manage. OPC is a hybrid of Sole-Proprietorship and Corporate form of business. It has been provided with various concessions in compliance requirements under the Companies Act. It is a form of a company where the compliance requirements are lesser than a private company.

One of the biggest

Advantages of a One Person Company (OPC) is that there can be only one member in a OPC, while a minimum of two members are required for incorporating and maintaining a Private Limited Company or a Limited Liability Partnership (LLP).

we provide you a hassle free one person company registration online process which would be dealt by our professionals within a time frame of 7 days and is subjective to governmental processing time. Our team takes care of the documents required for OPC registration and aids in provide you the realistic estimation of one person company registration cost.

Documents for One Person Company Registration

 Obtain DSC and DIN for directors and apply for name approval of OPC.

file for the SPICe  i.e. INC-32 and the MoA and the AoA

Certificate of Incorporation will be processed and approved.

Documents of Director and Nominee includes:-

  • Address Proof
  • Aadhaar card
  • PAN card
  • Photo
  • Email Id
  • Phone Number
  • Proof of the Registered office of the proposed Company along with the proof of ownership and a NOC from the owner
  • A declaration by the professional certifying that all compliances have been made.

3. Producer Company in India under the Companies Act, 2013

What is a Producer Company?

“Producer Company” means a body corporate

• Registered under amended Companies Act, 1956,

• The terms of section 465 of the Companies Act, 2013, the provisions of the Part IX A of the Companies Act, 1956 shall be applicable mutatis mutandis to a producer company

• The objects of the producer company shall conform to the activities included in 581B of the Companies Act, 1956.

A Producer Company combines the goodness of a cooperative entity and the benefits of a company.

In which Section is a Producer Company registered under the Companies Act, 2013?

As per Section 465 of the Companies Act,2013:

• Introduced in 2002 by incorporating a new Part IXA (section 581A to 581ZT) into the Companies Act,1956

• The Companies Act, 1956 and the Registration of Companies (Sikkim) Act,1961 (hereafter in this section referred to as the repealed enactments) shall stand repealed.

Members of a Producer Company and their Positions

A producer company is basically a body corporate registered as Producer Company under Companies Act, 2013

• In a producer company, only primary producers or producer organisations can become members

• Membership is acquired by purchase of shares in a Producer Company

• A Producer Company can act only through its members

• Members create the company

• Members can also wind up the company

• Members act through their General Meetings

What is the Minimum Share Capital for a Producer Company?

• The minimum Authorized Capital of Producer Company is Rs.5 lakh.

• The Authorized Capital of the company can be more than Rs. 5 lakh as indicated in the Memorandum of Association.

• The authorized share capital should be sufficient for carrying out the objects mentioned in the memorandum

• The authorized share capital should be realistic.

• The minimum paid-up capital for Producer Company is Rs. 1 Lakh.

Incorporation of a Producer company

The incorporation of a Producer company is the same as the incorporation of any other company under the Companies Act, 2013

Obtain Digital Signature of the Nominated Director, who will be affixing DSC on all the documents to be submitted to RoC online, on behalf of the company.

• Choose maximum 4 names for the Producer Company in order of preference.

• Apply for the name availability in Form – INC1.

• Once a name is available, a letter is received from RoC indicating it. The documents to be submitted to ROC thereafter are:

  • Articles of Association (AoA).
  • Memorandum of Association (MoA).
  • Form No. INC-22 for Registered Office.
  • Form No. DIR-12 for Directors’ Appointment.
  • Apply on-line for Directors Identification Number (DIN) for the proposed Directors.
  • INC-7 – Affidavits by subscribers to Memorandum of Association to be filed, in case, if they have signed in Hindi.
  • Power of Attorney in favour of a consultant to authorize him to make necessary changes in MoA and AoA as required by the RoC.
  • Submit the documents to RoC for Incorporation of Producer Company. m. Obtain Certificate of Commencement in INC-21.

What is a Certificate of Commencement (CoC)? 

CoC is issued by the RoC as a conclusive proof of formation of a Producer Company.

A Producer Company is effective and comes into existence from the date mentioned in the Certificate of Registration granted by the RoC.

What is the legal status of a Producer Company?

• On incorporation and from the date mentioned in the Certificate of Commencement (CoC), the company becomes a person in the eyes of law.

• It has perpetual succession, meaning members may come and go, but it will go on until it is wound up by following the process of law.

• It has a common seal, which is affixed on all the documents executed on behalf of the company in the presence of a director and signed by the authorized signatory or signatories.

• It is empowered to hold the properties in its own name and has its own right.

• It can enter into contracts in its own name.

• It can sue others and can be sued by others.

• In simple terms it has contractual capacity in the eyes of law just like any other person who has contractual capacity.

Time and Cost for Registration

• It takes between 2 months to 6 months for a registration of a Producer company.

• It is estimated that it may cost Rs. 40,000/- approximately.

• It depends on the fee charged by CA, Company Secretary and Authorized Agents etc.

Who bears the cost of registration?

• Initially the promoters of the company will bear the cost of registration of the company.

• The promoters are generally the Producer Organisation Promoting Institution (POPI) or the initial directors.

Who runs a Producer Company?

The company is run/governed by members/shareholders, the Board of Directors, and Office Bearers.

• Board of Directors are elected by the members.

• BoD may act collectively only through meetings.

How to become a member of a Producer Company?

• By subscribing to the MoA.

• By an agreement in writing to become a member and with an entry in the register.

Authority of the Members in the Company

Members exert authority on the company only through General Meetings. The General Meetings alone can do the following:

• Approve Budget and adopt Annual Accounts of the Company

• Approve the quantum of withheld price

• Approve the patronage bonus

• Authorize the issue of bonus shares

• Appoint an auditor

• Declare a dividend and decide on the distribution of patronage

• Amend the MoA and AoA h. Specify the conditions and limits of loans that may be given by the Board to any Director

• Approve any act or any other matter that is specifically reserved in the articles for decision for members.

What are the Voting Rights of the Members?

• In case of Producer Company comprising only of individual members or combination of individual members and producer institutions, then the voting rights shall be based on one vote per member

• In case of a Producer Company consisting only of producer institutions, then the voting rights shall be based on the participation in the business of the Producer Company in the previous year.

• The Producer Company can restrict the voting rights to only its active members provided it is authorized by its Articles of Association.

Board of Directors permitted

A producer company can have a minimum of 5 Directors and not more than 15 Directors.

Tenure of Directors

The tenure of a director appointed by AGM is minimum one year and a maximum of 5 years.

What are the advantages of a Producer Company?

• A Producer Company is a hybrid between a Private Limited Company and a Cooperative Society, thus enjoying the benefits of professional management of a Private Limited Company as well as mutual benefits derived from a Cooperative Society.

• Ownership and membership of a Producer Company is held only by “primary producers” or “Producer Institution/s” and member’s equity cannot be traded. Hence, nobody can take over the company or deprive the primary producers of their organisation.

• The clauses of Private Limited Company shall be applicable to the producer companies except the clauses specified in Producer Company Act from 581-A to 581-ZL which make it different from a normal private or limited company (refer the Producer Company Act for details). This enables a professional framework for a Producer Company.

• The liability of the members is limited to the unpaid amount of the shares held by them. Hence, the private assets of the members are safe from company losses.

• The minimum paid-up Capital being Rs. 1 Lakh and minimum authorized capital being Rs.5 lakh for a PC, it is easy to mobilise the small amount. f. Minimum number of producers required to form a PC is 10 while there is no limit for maximum number of members and the membership can be increased as per feasibility and need. This helps even 10 individuals start a Producer Company which is easy.

• There cannot be any government or private equity stake in the Producer Companies, which implies that PC cannot become a public or deemed public limited company. Hence, any Government or other corporate threat is non-existent in the professional functioning of the company.

• The area of operation for a PC is the entire country giving flexibility to expand and do business in a free and professional manner.

What are the limitations of a Producer company?

• A Producer Company is to be registered as per the Part IXA of Indian Companies Act 1956, Reference Section 465(1) of the Companies Act 2013. It is a must to register the company and non-registered entities are not given the benefit of the Act.

• Registration of a Producer Company is a bit difficult, generally requiring the services of a consultant.

• The registration of a Producer Company is a sometimes time-consuming process.

• The members cannot transfer their shares freely.

• Getting a professional CEO at an affordable cost is a little difficult.

• The Producer Company should follow the statutory provisions of the Indian Companies Act and should comply with the mandatory prescriptions of the Act without fail which is a little difficult for non-professionals to understand.

4. NIDHI COMPANY REGISTRATION

NIDHI stands for National Initiative for Developing and Harnessing Innovations. NIDHI Company is a financial institution or a type of NBFC that is involved in depositing and lending money to their members. This company is registered under the Companies Act, 2013 and is managed, as per the RBI’s guidelines. All the transactions are performed by the company’s members only. Since all the transactions are focused on the shareholders of the Nidhi Company, RBI has exempted the notified Nidhi companies from the core acts of RBI. This differentiates Nidhi companies from other NBFCs. Nidhi companies were started by the Ministry of Corporate Affairs (MCA) and are affiliated with the same. However, some of their decisions are controlled by the MCA.

Eligibility for NIDHI Company Registration

Given below is the eligibility criterion to fulfill before registering as a Nidhi Company:

  1. Apart from the core members, Nidhi companies must have a minimum of 200 shareholders of the company. Only when a company has this minimum number of shareholders, they can apply for Nidhi company registration.
  2. Any company wanting to register as a Nidhi company must have a minimum of Rs. 10 lakh of net-owned funds. This is necessary for the registration and must be followed. Any company having a lesser amount of net-owned fund is not eligible for Nidhi company registration.
  3. The ratio between the net-owned funds and the deposits cannot be more than 1:20 for any companies which want to register for Nidhi Company. A ratio more than this is not accepted for a Nidhi company registration.
  4. A company which wants to register as Nidhi Company must have a minimum 10% of unencumbered term deposits of the outstanding deposits. Term deposits more than 10% are acceptable but any less than 10% is not considered sufficient for Nidhi company registration.
  5. The name of the company must always contain ‘Nidhi Limited’.
  6. Companies registered under Nidhi company will be a public company.
  7. The registering company must have paid equity share capital of Rs. 5 lakh.

It is important to fulfill all of these requirements to register as a Nidhi Company with the Ministry of Corporate Affairs.

Benefits of Registration

Nidhi company registration has several benefits for the people bringing the company together. Some of the major benefits of Nidhi company registration are discussed in detail below:

1. Easy Formation

The formation of a Nidhi company is a simple process. There are very few requirements for the formation of a Nidhi company. Some of the primary things to be kept in mind for the formation are listed below:

  • Minimum of 7 members is required. 3 of these 7 members are appointed as directors of Nidhi company
  • Simple and hassle-free documentation process
  • Easy-to-do registration
  • Even after being a different type of NBFCs, the registration process is comparatively simple for Nidhi companies.

2. No Compliance to RBI

As we suggested above, Nidhi companies do not have to comply with the RBI regulations. This non-compliance gives the company freedom to inculcate better and different rules for its functioning. Complying with RBI’s regulations would have made it difficult for Nidhi companies to formulate their own rules and regulations which is a major point which differentiates them from other NBFCs.

3. Less or No Risk

Since all the lending and depositing transactions are performed by members of the company, it lowers the financial risk taken by the company. In Nidhi companies, only the members are involved with the financial transactions which make it safe and easy to track with the person depositing or borrowing funds from the company.

4. Economical Registration

Nidhi company registration is not heavy on the directors’ pockets. The registration cost is less for Nidhi companies as compared to other types of NBFCs. Even the formation of Nidhi companies is simpler than other types of NBFCs. This acts as a major benefit for the directors since saving money on registration can make it possible for directors to invest money in various business related activities. This can also help the Nidhi companies to get business loans when required for the growth of the company.

5. Certainty on Savings

The basic objective of Nidhi companies is to promote the culture of savings among the people of India. This objective makes the concept of Nidhi companies certain and trustworthy. Nidhi companies make sure that they will never jeopardize the savings of their members where ever they invest. Savings is an important practice to be inculcated in the individuals of all age groups of the society.

6. Net-owned Funding System

Nidhi companies follow the net-owned funding system. Net-owned funding refers to the transaction where the owner invests an amount in the business to raise funds for the same. In Nidhi companies the ratio of net-owned funding is 1:20, which means if an owners invests Re. 1 in his/her business he/she can raise a fund of Rs 20 for his/her business. This feature of Nidhi companies makes it cost effective for owners to invest in new business ventures and grow their company with more capital and diversify their business.

Documents Required for NIDHI Company Registration

Given below is a list of documents one requires for Nidhi company registration:

  • Passport-sized photographs
  • No Objection Certificate (NOC) (signed by the landlord/owner)
  • Digital Signature (DSC)
  • Director Identification Number (DIN) of directors
  • Memorandum of Association of the company (MoA)
  • Articles of Association of the company (AoA)
  • PAN Card: This is necessary for the filing of the financial transactions made by the company. PAN card is also necessary for the taxation process of the company
  • Address Proof
    1. Bank Statement
    2. Driving License
    3. Residence Card
    4. Any other Government issued identity proof having the address
  • Residential Proof
    1. Mobile Bill
    2. Telephone Bill
    3. Electricity Bill
    4. Bank Statement
  • Passport: Passports are only compulsory for the companies whose director is a foreign national. Passport is not a mandatory document for Indian directors of Nidhi companies
  • Registered Office Proof: Registered office proof for Nidhi company registration because of the importance of the same in the issue of government supported schemes and loans

It is important to note that Nidhi company registration application can be filled out online. Once the Nidhi company registration fee is fully paid, the registration form is submitted and sent for further processes of approval. Once submitted the Nidhi Company registration process is completed.

Forms to be filled

INC 9 – To be filed by all the subscribers to MoA
DIR 2 – To be filed by all the directors of the company, deceleration as per rule 5 & 6 of Nidhi rules 2014 – also to be signed by all the subscribers

FAQs 

Q1. Can Nidhi Company take deposits from a non-member?

Ans. No, all the financial transactions have to be made only between the shareholders of the company.

Q2. Are all the address proof documents necessary for Nidhi company registration?

Ans. No, any one of the address proof documents are to be submitted for the registration of Nidhi Company.

Q3. What document should I submit if I don’t own an office yet?

Ans. If you do not own an office but have an office on rent, you can submit your rental agreement and an NOC from the landlord for Nidhi company registration.

5. Public Limited Company

Public limited company registration with 8 DSC, 3 DIN, 1 RUN Name Approval, 10 lakh authorized capital, incorporation fee, stamp duty*, MOA, AOA, incorporation certificate, PAN, TAN, GST registration, business bank account opening. Inclusive of government fees and taxes.

Registration of a Public Limited Company

Incorporating a Public Limited Company is a suitable option for large scale businesses that require huge capital. There should be a minimum of seven members with no limit on maximum number of members/shareholders for starting a Public Limited Company.

Usually, Public Limited Companies get listed with stock exchanges to raise capital from the general public. This is why Public Limited Companies have to comply with multiple regulations of the government and starting a public limited company becomes a cumbersome process.

A Public Limited Company is defined under Section 2(71) of the Companies Act, 2013 as:

  • a company which is not a private company
  • a company with a minimum paid-up share capital of INR 5 lakhs.

Note : Under the Companies Act, 2013, a subsidiary company shall be deemed to be a public company if it is not a subsidiary to a private company, even if it is a private company as per its articles.

Minimum Paid-up share CapitalINR 5 lakhs
Minimum number of Directors3
Maximum number of Directors50
Minimum number of Shareholders7
Maximum number of ShareholdersNo Limit
PLC Documents
  • Passport sized photographs of all the Directors
  • Copies of the Identity documents of all the Directors- Aadhar Card, Voter Card, PAN card
  • DSC (Digital Signature Certificate) of all the Directors
  • DIN (Director Identification Number) of all the Directors
  • In case the office is in a rented property – the rent agreement
  • In case the office is an owned place – the property ownership documents
  • The water bill and the electricity bill of the business place
  • No Objection Certificate by the Landlord
  • Memorandum of Association (MoA)
  • Articles of Association (AoA)

It is necessary that all the documents pertaining to registration of a Public Limited Company are in order to avoid any legal complications later on.

Companies Act, 2013 does not permit registration of identical or similar names 

  • Fulfilling all the Legal Requirements for IncorporationFirst off, it is necessary that the legal requirements of minimum-paid up share capital, number of directors, number of shareholders, have been identified and fulfilled. Only if this step is complete, further steps of registration can be implemented.
  • Obtaining DIN and DSC for all the Proposed DirectorsOnce it has been established who all would be the directors of the company, their DIN from the Ministry of Corporate Affairs and DSC from the Certified Authority has to be obtained.The directors can only be individuals and not entities like LLPs or Financial Institutions. Also, the number of directors cannot exceed 50. It is not necessary for the Director to be the Shareholder of the Company
  • Registered OfficeIt is necessary to have a proper address to be recognized as the Registered Office of the Company. The Registered Office address has to be registered with Registrar of Companies (ROC) under whose jurisdiction the office location falls. All the correspondence related to business are made to the Registered Office by the ROC. The fee for registration shall be dependent on the authorized capital of the company.
  • Application for Company NamePrior to the registration procedure, the name of the Company has to be approved by the ROC. It is mandatory that the name of the Public Limited Company ends with the word “Limited”. This application is filed in the RUN form of the Ministry of Corporate Affairs. It is better to provide a list of names in order of preference, in case a particular name is not available.
  • Execution of Company Registration DocumentsOnce the name of the Company has been approved, the crucial documents of the Company – MoA and AoA have to be executed. These documents have now gone electronic and can be prepared and submitted there itself. (eMoA: INC33 & eAoA: INC32)
  • Submission of Documents to ROCOnce all the documents have been prepared, they are submitted to the ROC for verification.
  • Registration and COIUpon proper verification of all the submitted documents, the ROC registers the company and issues a Certificate of Incorporation along with the CIN (Corporate Identification Number) of the Company.
  • Certificate of Commencement of BusinessA Public Limited Company cannot start its business immediately upon receiving the COI. It has to apply for Certificate of Commencement of Business within 180 days of receiving the COI, stating that all the subscribers have paid the subscription money.

Annual compliances of a Public Limited Company differ for an unlisted Public Limited Company and listed Public Limited Company.

  • Board meetings : An unlisted Public Limited Company is required to hold at least 4 Board meetings in compliance with Section 173 of the Companies Act, 2013.
  • Appointment of a Cost Auditor : The auditor is required to be appointed as per Section 148(3) along with Rule 6(2) and Rule 6(3A) of the Companies (Cost Records and Audit) Rules, 2014. For this, Form CRA-2 has to be filed.
  • It is pertinent to mention that original appointment of the auditor has to be done within 30 days of Board meeting or 180 days of Financial Year, whichever is earlier. When a casual vacancy arises, the same has to be filled within 30 days.
  • Return of Deposits : This has to be filed with the ROC under whose jurisdiction the company falls via Form DPT-3, in compliance with Rule 16 of Companies (Acceptance or Deposit) Rules, 2014.
  • Appointment of CFO or CS or CEO : Section 203 read with Rule 8 & 8A of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 requires appointment of CFO or CS or CEO within 30 days of AGM or within 6 months in case of casual vacancy. For this, Form MGT-14 and Form DIR-12 are filed.
  • Annual General Meeting : AGM for declaration of dividend has to be conducted in compliance with Section 96 of the Companies Act, 2013.
  • CSR Committee : CSR Committee has to hold four meeting with a gap of not less than 120 days between two meetings for discussion and approval of CSR activities. This is done in compliance with Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014 and Secretarial Standard-1.
  • Director’s Disclosure : Director’s are required to disclose any financial interest in the company via Form MBP-1in compliance with Section 184(1) of the Companies Act, 2013 read with Rule 9(1) of the Companies (Meetings of Board and its Powers) Rules, 2014.
  • Annual General Meeting : Annual General Meeting has to be held in accordance with Section 121(1) of the Companies Act, 2013. Form MGT-15 has to be filed once the AGM has been conducted.
  • Financial Statements : The financial statements of the company have to be filed as per Section 137 of the Companies Act, 2013, read with Rule 12(2) of the Companies (Accounts) Rules, 2014. The financial statements consist of Balance sheet, Cash Flow Statement, Director’s Report, Auditor’s Report and the combined Financial Statement which is prepared in XBRL (Extensible Business Reporting System). This is filed via Form AOC-4.
  • Annual Return : This has to be filed in accordance with Section 92 of the Companies Act, 2013, read with Rule 11(1) of the Companies (Management and Administration) Rules 2014. The annual return contains information pertaining to the directors and shareholders and is required to be filed in Form MGT-7 with the relevant ROC.
  • Financial and Director’s Report : Adoption of Financial and Director’s Report has to be done in consonance with Section 173 of the Companies Act read with Secretarial Standard 1. Its filing is done via Form MGT-14.
  • Income Tax Returns : This has to be filed with the Tax Department in Form ITR-6 on or prior to September 30th of the Financial Year.
  • Secretarial Audit Report : Submission of Secretarial Report is a requirement under Section 204 of the Companies Act, 2013 read with Rule 9 of The Companies (Appointment and Remuneration Personnel) Rules, 2014. Secretarial Report has to be submitted only when the company’s total Paid-up capital is equal to or crosses INR 50 crores or its annual turnover is equal to or exceeds INR 250 crores. This has to be filed via Form MR-3.
  • Other compliances : These include the rules and regulations laid down by SEBI. Listed companies have to comply with the Listing Regulation of 2015.
PLC Advantages
  • Separate Legal Entity : A Public Limited Company is considered as a separate legal entity from its shareholders. It has a perpetual existence and can have its own PAN, bank accounts, approvals, contracts, licenses, assets and liabilities.
  • Multiple avenues of funding : Public Limited Company can raise funds from individuals as well as from financial institutions. The funds may be raised via equity shareholding, preference shareholding or debentures.
  • Easy transferability of shares : This is one of the biggest advantages of a Public Limited Company. The shares can be easily transferred by a shareholder to other legal entities – be it an individual or an organization, in India or abroad. The directorship of the company can also be changed for ensuring business perpetuity.
  • Limited liability : The shareholders of a Public Limited Company are given Limited Liability Protection. In a situation of unexpected liability, the same would be limited only to the company and not affect the shareholders.