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Incorporation of Private Ltd Co in India :-

Advantages for incorporation of Private Limited Company in India :-

1. Limited risk to personal assets : The shareholders of a private limited company have limited liability. This means that as a shareholder you will be liable to pay for company’s liability only to the extent of the contribution made by you.

2. Legal Entity : A Private Limited Company has a separate legal entity different from you. This means that the Company is responsible for the management of its assets and liabilities, debtors and creditors. And you are not responsible for it. So, the creditors cannot proceed against you to recover the money.

3. Raising Capital : Even though registering a Private Limited Company comes with compliance requirements, it is preferred by entrepreneurs as it helps them raise funds through equity, expand and at the same time limits the liability.

4. Trustworthiness : Companies in India are registered with the Registrar of companies (ROC) under Companies Act 2013. Anyone can check the details of the company through Ministry of Corporate Affairs (MCA). Also, details of all the directors are provided while the formation of the company. Hence a Private Limited Company form of business structure is trusted more.

5. Continue Existence : A company has ‘perpetual succession’, that is continue or uninterrupted existence until it is legally dissolved. A company, being a separate legal person, is unaffected by the death or cessation of any member but continues to be in existence irrespective of the changes in membership.

6. Capacity to Sue and Be Sued : A company being a body corporate, can sue and be sued in its own name. To sue, means to institute legal proceedings against (a person) or to bring a suit in a court of law. All legal proceedings against the company are to be instituted in its name. Similarly, the company may bring an action against anyone in its own name.


Following simple steps are taken to register a Pvt Ltd Co in India :

Step 1: Acquire DSC for Directors and Subscriber :

The first and foremost step to register a private limited company is to acquire the Digital Signature Certificate (DSC) of the Directors and Subscribers to MOA & AOA. A e-form is filed with the MCA after affixing the DSC of the Authorised Signatory. Also, it is required for the application of DIN of the directors.

Step 2: Obtain DIN for Directors :

DIN is abbreviation of the term Director Identification Number. While incorporating a company, the DIN allotment is carried out by the Ministry to the Individual for acting as Director in a company.

Step 3: Name approval Application :

The next step in company registration involves making an application for reservation of name for the proposed company. The application is to be made in Form INC-1, where one can apply for maximum 6 names in order of the preference.

Once the name applied is approved, it is reserved for the applicant for a period of 60 days, in span of which one has to apply for the Incorporation of Company, non-compliance of which leads to withdrawal of the name granted by the Ministry.

Step 4: Application for Certificate of Incorporation :

Once the name is reserved for the proposed company, one shall proceed for making Application of Certificate of Incorporation in SPICe form accompanied with SPICe_MOA and SPICe_AOA.

The application is submitted by paying the requisite Stamp Duty as applicable in case of concerned state on the portal. Once the application is submitted, form for application of PAN and TAN of the company is generated online, which shall be duly submitted after affixing the DSC with MCA.

  • MOA and AOA -

MOA and AOA are two most important documents for any company and marks the last step in the process of registering a Company.

MOA of company states the scope of operations of the company, whereas AOA states how the company will be carrying the operations as per the laid Act. In case of a Private Limited company, the Articles shall mandatory consist the following three clauses in addition to general clauses:

  • Limitation - on the number of members up to 200.

  • Restriction - on transfer of shares.

  • Prohibition - on accepting securities from public.

After due verification of the application and documents provided (for required set o documents please refer the attachment), the concerned RoC may grant the Certificate of Incorporation (COI). It is a conclusive proof of existence of the company, wherein the date of Incorporation, Company Identification Number (CIN) and Permanent Account Number (PAN) is mentioned with the sign and seal of the Registrar.

Once, the Certificate of Incorporation is granted, the company may commence the Business Activity as the Incorporation procedure is completed.

For required set o documents please refer the PDF attachment -

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1 Comment

Ameya Agrawal
Ameya Agrawal
Jun 10, 2020

Very useful information.

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