INTRODUCTION:
A Private Limited Company (PLC) is one of the most common types of legal entities in India. Private limited corporations are governed by the corporations Act of 2013, which stipulates that there must be a minimum of two shareholders and two directors, one of whom must be an Indian citizen and resident.
To get register in India, following to be the minimum:
• There should be two directors, with one of them being an Indian national and resident.
• There can be two stockholders, including the directors.
• Indian registered office
The majority of industries in India accept 100% foreign direct investment (FDI), and there are no limits on foreign ownership of shares of private limited firms.
Private Limited Company Registration in Chennai:
A minimum of 2 directors and a maximum of 15 directors may be chosen for online company registration in India.
There is no minimum paid-up capital necessary to register a Private Limited Company in Chennai. Additionally, the name must conclude with PVT. ltd.
If the following conditions are met, forming a business in Chennai is simple:
• At least two directors must be Indian citizens.
• Must be 2 shareholders to 200 shareholders max.
• Government fees for business registration in Chennai must be paid for a minimum of shares valued at Rs. 1 lakh.
• You need a registered address.
In Chennai, registering a company is simple and takes about 10 days. India Filings has been offering very cost-effective registration services throughout India.
Importance of Private Limited Company Registration in Chennai:
The following are the key advantages of creating a private limited company in India as opposed to other entity types.
Separate Legal Entity
A firm is both a legal entity and a juristic person. As a result, a business is granted a variety of legal privileges, such as the power to acquire property, incur debt, hire staff members, etc. Because a corporation is a separate legal body, neither its shareholders nor its directors are personally liable for the corporation's debts.
Small Liability
A private limited company is a separate legal person with certain liability constraints. As a result, the shareholders are not liable for any losses incurred by the company that exceed the amount of share capital they contributed.
Continuous Existence
Perpetual succession refers to a company's ability to remain indefinitely without being formally dissolved. A company continues to exist regardless of membership changes because it is a separate legal entity and is unaffected by the death or other departure of any of its members.
Raising Money
A private limited business has a variety of funding alternatives. A business can raise money from investors, shareholders, angel investors, venture capitalists, private equity funds, foreign funds, non-bank financial companies (NBFCs), banks, and other financial organizations. Investors can only provide debt and equity funds to a corporation.
Transferability
The company's directors and management can simply transfer their ownership from one person to another, saving the business owners' time, money, and a significant amount of stamp duty.
Dual Relationship
In a company structure, a separate shareholder's agreement may be executed between the company and its directors, promoters, and other stakeholders. Additionally, it is conceivable that the promoter will join the organization as an employee and receive pay.
The individual simultaneously becomes a shareholder, director, employee, and a creditor of the business.
As a director, he can receive compensation from the company. As a shareholder, he can receive dividends from the company. As a landlord or lessor, he can receive rent from the company. As a creditor, he can lend money to the company and receive interest. As a supplier, he provides the company with goods or services from his family business.
Ability to borrow
As a business, it has better options for obtaining money for operations. Debenture certificates, private placements, the issuance of preferred share capital, etc. are all possible. take public deposits and borrow money from banks even though banks prefer to lend to corporations over sole proprietorships and firms.
Tax advantages
Only the net profit is subject to taxation, and the taxable net profit is the one that remains after all costs have been offset, including director salaries and other costs. As a result, the net taxable income is significantly reduced, and the net profit of the company is subject to little or no tax.
Cost of maintenance
The cost of managing company compliance will vary based on the business. Turnover and capital spent, license necessary, but maintaining business with good compliance, unquestionably gain market goodwill. Consider the annual cost of compliance, which can range from INR 8,000 to 50,000 depending on the company's turnover and paid-up capital.
Permanent Existence
A company's ability to continue operating without being formally dissolved is known as perpetual succession. Because a business is a separate legal entity and is unaffected by the death or other departure of any of its members, it continues to exist despite membership changes.
Required Documents for Private Limited Company Registration in Chennai:
The potential directors must submit identification in the form of the following documents in order to register a private limited corporation:
1. Indian citizens: PAN card is required.
2. International Residents: A passport is required.
3. In addition to the paperwork mentioned above, the Directors must provide one of the documents listed below, which includes the Director's address.
4. Election ID, Ration Card, Passport, Driver's License, and Aadhaar ID are all required for Indian citizens.
5. For foreign nationals, a driver's license, a bank statement, and a residence card are required.
6. This document cannot be older than two months.
7. Bank statements, utility bills, and phone bills for Indian nationals
8. Bank Statements, Electricity Bills, and Phone Bills for Foreign Nationals
Finally, as proof of residency, potential Directors must present one of the following documents.
The following paperwork needs to be provided if one of the company's shareholders is an organization with its headquarters in India or abroad:
• A board resolution approving investments in the business;
• A copy of the business' incorporation certificate;
Registration Process of Private Limited Company in Chennai:
The following are the steps involved in registering a company in India:
RUN Name Acceptance first
The Ministry of Corporate Affairs must first receive approval of the company name before the firm name may be reserved. The name approval application may include one or two names with commercial objectives. If a name authorization request is rejected, one or two more names may be submitted. The MCA normally approves all name approval requests in less than 5 business days.
Second, Director's digital signature
The Ministry of Corporate Affairs in India prohibits wet signatures. For filings with the MCA, all signatures must be digital and confirmed by an Indian Certification Authority. Therefore, digital signatures from the Directors are required before to incorporation.
A certified certifying authority will grant a digital signature for the Directors to India Filings. A digital signature cannot be obtained until the Directors have submitted proof of their identities and gone through a video KYC procedure successfully. If the Director is a foreign national, the given passport and other documents must have an embassy in the area apostilling them.
Third, Application for Incorporation Submission
Following the collection of digital signatures, the incorporation application in SPICe Form and all necessary attachments may be delivered to the MCA. Together with the application for incorporation, the company's Memorandum of Association (MOA) and Articles of Association (AOA) are submitted. When the MCA determines that the incorporation application is full and acceptable, the company's incorporation certificate and PAN are issued. The MCA normally accepts all petitions for incorporation in fewer than five business days.
Conclusion:
Hence, these are the steps explained in brief regarding the process of getting a private limited company registered in India.
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