WHAT IS A PRIVATE LIMITED COMPANY (PVT LTD)?
A Private Limited Company is a type of business entity having private ownership in the form of Directors. The benefit of having a private limited company is that there are limited (and specific) liabilities of directors and depending on each one’s point of view. This next point could either be a benefit or a disadvantage.
KEY FEATURES OF PRIVATE LIMITED COMPANY:
A private limited company has the following features:
Minimum and maximum number of shareholders in a private company is 2 and 200, respectively
Minimum paid-up capital is Rs.1,00,000
Minimum number of directors are 2
Share transfer can be restricted as per Articles of the company
Cannot accept deposits from the public and it can take loans only from shareholders, directors and relatives of directors
Cannot issue shares to the public
Name of the company should end with 'Private Limited' or 'Pvt Ltd'
The Private limited company can sue and can be sued
The Private limited Company has separate legal entity other than it’s Directors and Shareholders.
BENEFITS OF COMPANY REGISTRATION?
Registering a company offers many benefits. A registered company increases the authenticity of your business. It helps your business:
Shield from personal liability and protects from other risks and losses
Attract more customers
Procure bank credits and good investment from reliable investors with ease
Offers liability protection to protect your company’s assets
Greater capital contribution and greater stability
Increases the potential to grow big and expand
NECESSARY DOCUMENTS FOR THE FORMATION OF A PRIVATE LIMITED COMPANY
PAN Card – PAN Card of shareholders and Directors.
Foreign nationals must provide a valid passport.
Identity Proof – Aadhar card and Voter ID/ Passport/ Driving License of Shareholders and Directors.
Director’s Address Proof - Latest Telephone Bill /Electricity Bill/ Bank Account Statement of the Shareholders and the Directors.
Photograph - Latest Passport size photograph of the Shareholders and the Directors.
Business Address Proof - Latest Electricity Bill/ Telephone Bill of the registered office address.
NOC from owner - No Objection Certificate to be obtained from the owner(s) of the registered office.
Rent Agreement - Rent Agreement of the registered office should be provided.
Note - In case of NRI or Foreign National, documents of director (s) must be notarized
ADVANTAGES OF PRIVATE LIMITED COMPANY REGISTRATION
Easy Fund Raising – Pvt. Ltd. Company registration method is demanding enough to create this structure credible among others that makes fundraising or borrowing from external sources easier. The organization itself provides variety of ways to boost funds in the form of private equity, ESOP, and more.
Separate Legal Existence – Once the company registration in India is completed, a legal entity is born in eyes of law. This separates itself from its owners and managers. The company can operate on its own name just by opening a bank account to have assets and enter into contract with parties. This additionally provides right to sue third parties in case of any defaults.
Owners’ Limited Liability – The company’s obligation or debts of doesn't produce a charge over the owner’s personal assets. Their liability stays restricted only to the capital subscribed and unpaid by them.
Management and Ownership Separation – The separate ownership and management facilitate both – the company and also the management to specialize in their potential works. The shareholders assign responsibility to work and run the company while not losing control in the form of voting.
HOW TO REGISTER A COMPANY ONLINE - THE REGISTRATION PROCESS?
Company registration in India benefits startups since it offers them an advantage over those who have not registered. The process of registering your company is complex and involves much compliance. However, you needn’t worry as long as you have lenstax as our professionals can help you with every step of the private limited company registration process.
STEP 1 - OBTAIN DSC
STEP 2 - APPLY FOR THE DIN
STEP 3 - APPLICATION FOR THE NAME AVAILABILITY
STEP 4 - SUBMISSION OF MOA AND AOA TO REGISTER A PRIVATE LIMITED COMPANY
STEP 5 - APPLY FOR THE PAN AND TAN OF THE COMPANY
STEP 6 - ROC ISSUES A CERTIFICATE OF INCORPORATION WITH A PAN AND TAN