Did you know? As of March 2020, the total number of registered companies in India was 1.48 million by statista report.
As you can see the number above includes all types of companies whether limited by shares, unlimited companies, private and public as well. There are innumerable businesses that are running without any company registration across the country.
However, registering your company can benefit you in different ways. In this article, we will be discussing those benefits, the process of online registration of a privately held company, and other related details.
What is the online registration of a private limited company?
Registration is necessary for a business house to become a company. A privately held company also needs to register and get the certificate of incorporation to get a legal entity like a company. A privately held company can register itself with the Registrar of Companies, which is the authorized body to register every company in the country online.
If you are looking to register a private company, you can complete the registration process completely online without any hassle. The company registration involves multiple steps which you need to go through to register the company finally.
Process of registration
The process of company registration can be segregated into 4 different steps –
- Arranging the Digital Signature Certificate: The first step is to acquire the digital signature certificate as registration is online. You can get the certificate by filling the form on the MCA website for the same.
The Digital signature certificate is mandatory for every director of the company. It is also mandatory for the subscribers and witnesses of the memorandum of association and articles of association.
- Acquiring the DIN: Then comes DIN, the Director Identification Numbers, and it is mandatory for all the proposed directors of the firm. The name of the directors, their address proofs need to be mentioned in the form when applying for the DIN.
- MCA Portal Registration: As this process is completely online, there is this site MCA which is a government website for company registration and similar work. You need to visit this site, then click on the SPICe+ form.
Then fill the form, submit it properly. However, before filling the SPICe+ form, you need to register on the MCA portal if you are the director of the company you want to register. Once you are a registered member on the portal, you can access all the forms and other documents and information.
- Receiving the certificate of incorporation: Finally, your task is over. If the Registrar of the company approves your application for the company registration, then you will be notified and receive the certificate of incorporation.
Documents required for registration
The documents required to be provided by the directors and the subscribers are as follows:
- The subscribers need to give an affidavit on stamp papers that they willingly subscribe to the company and want to become the shareholders.
- Address proof of the office which will be the registered office of the company
- Utility bills’ photocopies which are not older than 2 months.
- Government approval if the company’s name has certain words in it or expressions that require the same.
- NOC from the property’s owner ( in case of rental property)
- Trademark registration certificate if required
- DIN has to be attached when applying for the registration. If some don’t have, then identity proof and address proof must be attached.
Advantages of registering a private company
Registering your company online can help you in many ways –
- It can work as a defense mechanism on threats, losses, and personal obligations.
- Goodwill creation is another big reason for registering your company. Registered companies are more trustworthy than companies that are not registered. This, in turn, creates goodwill.
- It helps you avail of loans from banks easily for the company/ business.
- The company became more stable as well.
- It aids in the development of the business and expansion as well.
After the company is registered, it needs to follow certain compliance terms, which are –
- Appointing the first auditor within 30 days from incorporation.
- There must be at least 4 board meetings in a year at particular intervals.
- It needs to file a profit and loss account, balance sheet, annual return, and auditor’s report to the Registrar of companies every year.
What if ROC rejects the company registration?
The Registrar of companies can cancel or not approve the application for registering the company. There can be different reasons for the same. The most common reasons for not approving the application include –,, the name of the company which is proposed doesn’t sync with the products it manufactures or service it renders.
- The proposed name is already there for other companies, or some company has already registered it earlier. Even if it is a close resemblance, then also, the application can be rejected.
- The proposed name is too generic without any specifications.
You can find more details on the common reasons for not approval here on this site – https://www.mca.gov.in.
Registration is necessary for a company to be a legal entity. No company can be a legal entity with the Registrar of Company registering it in India. Company registration helps build the brand value and goodwill and thus helps in the growth of the business. The process of online registration of private companies in India is pretty simple, as you saw above. It can be done in four easy steps.
- How many directors are required for registering a private company in India?
Ans: There must be at least 2 directors in a private company for being registered as a private company. However, the number can go up to 200 as well.
- How many shareholders should be there?
Ans: There must be two shareholders as well besides the two directors.
- Do all the directors require DIN?
Ans: Yes, all the directors’ DIN is required for the company registration. If there are 2 directors or two hundred, all DINs are required by the Registrar.
- Can a residential address be the registered address of a private company?
Ans: Yes, any address, whether residential or commercial, can be used as the address for the registered office of a privately held company as per the guidelines of MCA.