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September 5, 2015 By Prince Kunal

FAQ ON COMPANY REGISTRATION IN PATNA-COMPANY REGISTRATION RANCHI

FAQ ON COMPANY REGISTRATION IN PATNA-COMPANY REGISTRATION RANCHI-COMPANY REGISTRATION PROCEDURES IN PATNA-RANCHI-FREQUENTLY ASKED QUESTIONS

FAQ ON COMPANY REGISTRATION IN PATNA-COMPANY REGISTRATION RANCHI-COMPANY REGISTRATION PROCEDURES IN PATNA-RANCHI-FREQUENTLY ASKED QUESTIONS

Company Registration in India – FAQs

1) What are the type of companies that I can register in India?

  • One Person Company (OPC) – It is a form of company with only one member.The process of starting up an OPC is same as that of a general private limited company. It is a hybrid structure that infuses the benefits of a sole proprietorship business with a company form of business.
  • Private Limited Company– A separate legal entity with perpetual succession. A minimum of two persons are required for a company registration. Interestingly, no MINIMUM PAID UP CAPITAL is required to start a company.
  • Public Limited Company– At least least three directors. A public limited company can start its operations only after obtaining a Certificate of Commencement from the Registrar in addition to Certificate of Incorporation.
  • Company Limited by Guarantee – A major difference of this form of company with other forms is that it does not have a share capital or any shareholders. Incidentally, the company is governed by its members, and the extent of their liability is defined by the Memorandum of Association.
  • Non-profit Organizations (Generally known as Sec.8 Companies) – In India, popularly called Non-Profit organizations, come in three flavors, namely Trusts, Societies, Section 8 companies.

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2) What is a One Person Company (OPC)?

A One Person Company (OPC) is a hybrid structure, wherein it combines most of the benefits of a sole proprietorship and a company form of business. It has only one person as a member who will act in the capacity of a director as well as a shareholder. Section 2(62) defines One Person Company as a company which has only one person as a member.

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3) What will be the form of One Person Company?

One Person Company will be formed as a “Private Limited Company”. It can be formed as company limited by share capital or limited by guarantee or unlimited company. The words “One Person Company” will have to be mentioned in brackets below the name of such company, wherever its name is printed, engraved or affixed.

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4) What is the minimum authorized capital for starting up a One Person Company?

The process of starting an One Person Company is the same as that of a general private limited company. Hence, the minimum authorized capital of the One Person Company would be Rs. 1, 00,000. However, there is no minimum paid up capital requirement.

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5) What is the minimum number of directors and shareholders to form a One Person Company?

An One Person Company can be started with one director and shareholder only.

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6) Who is a nominee in a One Person Company?

A nominee is a person who in the event of death or disability of the subscriber of the One Person Company shall assume his position. Memorandum of Association of an One Person Company will mandatorily prescribe the name of the person. __________________________________________________________________________________________________________________________________

7) Can I appoint my wife as my nominee for my One Person Company?

Yes. Anyone can be appointed as a nominee, provided he or she holds a correct PAN in his or her name. __________________________________________________________________________________________________________________________________

8) How many One Person Companies can I form?

One individual can form only one One Person Company. __________________________________________________________________________________________________________________________________

9) Can a foreign national form an One Person Company?

No. Only an Indian citizen and resident can form an One Person Company. __________________________________________________________________________________________________________________________________

10) Who is considered as resident for the purpose of forming an One Person Company or being appointed as a nominee?

For the purposes of this rule, the term “resident in India” means a person who has stayed in India for a period of not less than one hundred and eighty two days during the immediately preceding one calendar year. __________________________________________________________________________________________________________________________________

11) In how many One Person Companies can a person become a nominee?

A person can become a nominee in not more than 1 One Person Company. __________________________________________________________________________________________________________________________________

12) What are the advantages that I will get if I incorporate a company in India?

  • Liability of the subscribers (the directors and shareholders) is limited to the amount of money they have paid for shares, thus Stakeholders are not typically liable for corporate debts and liabilities.
  • Extra capital can be raised by selling shares either privately or in the market. Members can leave or join without any restriction.
  • The death, bankruptcy or withdrawal of capital by one member does not affect the company’s ability to trade.
  • The disposal of the whole or part of the business is easily arranged.
  • Enjoys high credibility as the books of accounts and other documents are available for public vigilance.
  • ESOPs sweat equity and other incentives can be issued, which help attract and attain best of talents.
  • Overall transparency at various levels.
  • Separate Legal Entity from its owners. A company can sue or be sued on its own name.
  • Broader capital base than proprietorship firms. Usually attracts venture capitalists, angels and merchant bankers.

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13) I wish to register a company in India. Which type of company will be best suited for me?

The choice of the entity depends on the circumstances of the case.

  • Private Limited Company has lesser legal compliances.
  • It is relatively less cumbersome to incorporate, organize and operate a Private Limited Company as it has been exempted from many regulations and restrictions to which public limited company is subjected to.
  • There is no requirement of raising finance through public issue in case of Private Limited Company.
  • A Private Company can commence its business immediately after its incorporation, whereas a Public Limited Company cannot start its business until a Certificate of commencement of business is issued to it.
  • If limited capital is available, scale of operation is relatively low and ownership is intended to be held by limited people, then Private limited company is the best choice.

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14) What is Authorized Capital ?

The authorized capital of a company is the maximum amount of share capital that the company is authorized by its constitutional documents to issue to shareholders. It can be altered from time to time. __________________________________________________________________________________________________________________________________

15) What should be the minimum authorized capital for registering my company?

There is NO requirement of a minimum paid-up capital! You can start with any amount as you are comfortable with. __________________________________________________________________________________________________________________________________

16)What is the tax structure of an One Person Company?

An OPC is taxed at the corporate tax rate of 30%. __________________________________________________________________________________________________________________________________

17) What is Paid-Up Capital for registering my company?

Paid-Up Capital is the amount that has been received by shareholders who have completely paid for their purchased shares. This would not include any shares that have been bid on, but not yet purchased. __________________________________________________________________________________________________________________________________

18) Which city is best for registering company in India?

It will depend upon the nature of business you intend to pursue. However, after registering over hundreds of companies, it is our practical advice to keep note of few of many factors before registering your company in any city:

  • The local registrations that will be required to be obtained for the company after its registration.
  • Nature of your business and the demographic advantage that the city is expected to provide.

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19) Is it possible for two foreign nationals to register a company in India?

Yes, an Indian company can be incorporated with one or more foreign nationals as Directors. However, in private company wherein there are 2 directors and both of them are foreign nationals, one of them has to be a resident in India for a period of at least 182 days in the calendar year(as per Companies Act 2013). Also, wherein both the directors are foreign nationals, then disclosure has to be made whether 100 % FDI is allowed in the desired sector or not. However, foreign nationals cannot form an OPC in India. __________________________________________________________________________________________________________________________________

20) Can I, as an individual register a company solely on individual basis?

As per Companies Act, 2013, you can. The new Act provides for the concept of One Person Company, wherein an individual can start a company on individual basis. __________________________________________________________________________________________________________________________________

21) How to know if the desired name for the proposed company is available or not?

Before fixing on any name, one should always avail the public search of existing company/LLP name along with trademark search. More unique the name more is the chances of their quick reservation. __________________________________________________________________________________________________________________________________ 22) What is a DIN Number? DIN Number is a unique identification number allotted to the directors by the Government. For obtaining a DIN number, application is made to the Government in Form DIR-3 with requisite documents. The prescribed Government fees for obtaining one DIN are Rs.500. __________________________________________________________________________________________________________________________________

23) I already have a DIN number allotted to me. Do I need to obtain another one for the new company I wish to register?

No, DIN is a one-time formality. __________________________________________________________________________________________________________________________________

24) I already have a DIN and I wish to update my address in my DIN records.

The name, address, e-mail ID, phone number, residential status, all can be updated by making an application in Form DIR-6, along with requisite documents and declaration. There are no prescribed Government fees for the purpose. __________________________________________________________________________________________________________________________________

25) Is DIN and PAN connected?

Yes, the basic personal details, namely the name of the applicant, father’s name of the applicant and his/her Date of Birth are verified by the DIN authorities from the PAN database. __________________________________________________________________________________________________________________________________

26) Does Shareholders have to be directors as well?

There is no such compulsion as to the point that shareholders have to be directors as well. There can be a separate group of persons acting as directors and a separate group of persons acting as shareholders. Directors are the hands and brains of a company where as shareholders are the owners of the company. __________________________________________________________________________________________________________________________________

27) Can an existing company be director and shareholder in another company that is to be incorporated?

An existing company can be a shareholder in another company that is to be incorporated. For this purpose, a clear distinction has to be made as to whether the existing company is acting as a holding company or not. Also, the company will have to nominate a natural person to act as its representative. However, it cannot be a director in the same. __________________________________________________________________________________________________________________________________

28) What is the minimum qualification to act as a director in a private limited company?

There is no such prescribed qualification. __________________________________________________________________________________________________________________________________

29) What is DSC?

DSC is Digital Signature Certificate. DSC is required for at least one director for the purpose of Company Registration of a private company. It is required to file the forms electronically with the department. __________________________________________________________________________________________________________________________________

30) Can DSC be obtained by an NRI acting as a director?

Yes, DSC can be obtained by NRI acting as a director. __________________________________________________________________________________________________________________________________

31) Can the directors use their residential address as the registered office of the company?

For registered office address of the proposed company, directors can use their own residential address or their relative’s address or any address for which they can furnish valid documents as proof consisting of a No Objection Certificate from the respective owner. __________________________________________________________________________________________________________________________________

32) What is the duration of getting a private limited company registered?

The time limit to get a company registered is twenty-twenty five days provided all the valid documents are provided and uploaded with the department. __________________________________________________________________________________________________________________________________

33) When can a Bank Account for the company be opened?

Bank Account for the company can be opened after receipt of the Certificate of Incorporation and generation of PAN Acknowledgement. __________________________________________________________________________________________________________________________________

34) What is the validity of a name once reserved?

A name once reserved by filing Form INC-1 is valid for a period of sixty (60) days from the date of the filing of the name approval form. However, RoC has the power to revoke the granted name at any time, after giving due notice to be heard. __________________________________________________________________________________________________________________________________

35) Difference between rejection and resubmission.

When a particular form comes for resubmission, then the same can be submitted again vide the same SRN number. Its like chances that are given by the ROC to rectify the documents that are submitted without any additional Government fees. However, if the Forms get rejected then fresh filings for the same has to be done. __________________________________________________________________________________________________________________________________

36) Can a person residing in Kerala incorporate a company in Bangalore?

Yes. He can, provided he can furnish satisfactory documents as registered office address proof. __________________________________________________________________________________________________________________________________

37) Can same address be used as registered office address proof for two different companies?

Yes, it can be used but only after obtaining No Objection Certificate from the owner. __________________________________________________________________________________________________________________________________

38) What is the process to validate the documents for foreign nationals?

All the documents provided by foreign nationals, ranging from DIN declaration to subscriber’s sheets of the MOA and AOA either needs to be notarized by a notary public and subsequently apostilled OR notarized by a notary public and stamped by the Indian Consul of their respective countries. __________________________________________________________________________________________________________________________________

39) Mr. X, a director of a said company had used his residential property as registered office address. Will the property be treated as company’s property?

No. A company has a separate legal entity from its owners. Mere use of the owner’s property does not make establish ownership. Hence, the property will remain Mr.X’s. __________________________________________________________________________________________________________________________________

40) A company has a registered office in Bangalore. However, the directors wish to conduct the business from Kerala. Do they need to change their registered office?

No. There is no such compulsion. A company might have its registered office in one particular state and any number of corporate offices all over the country. __________________________________________________________________________________________________________________________________

41) Can a subsidiary of a foreign company be incorporated in India?

Yes. However, decision has to be made regarding the percentage of shares held by the holding company (foreign company) and the sector in which it is to be established since 100 % FDI is allowed only in selective sectors as of now. __________________________________________________________________________________________________________________________________

42) What are the additional requirements in case of subsidiary of a foreign company to be incorporated in India?

Apart from the usual notary and apostillation requirements, two Board Resolutions will have to be filed with the concerned ROC while filing Form INC-1 and Form INC-7, stating the resolutions that are held by the holding company with respect to its intention of forming a subsidiary company and stating the number of shares to be held by it, respectively. The same has to be notarized and apostilled. __________________________________________________________________________________________________________________________________

43) Shall a separate ID be created for the proposed company?

Its not a mandate. However, it is always advisable to formulate a separate ID for the company for the purpose of maintaining integrity and future confidentiality. __________________________________________________________________________________________________________________________________

44) Is just rent agreement considered a valid address proof for company registration?

No. For company registration, utility bill or tax receipt is mandatory. __________________________________________________________________________________________________________________________________

45) What is Memorandum of Association (MOA)?

MOA is the fundamental incorporation document. It defines the name and address of the registered office of the company. It also defines the main objects for which the company is formed. The activities of the company are bound by MOA and is likely to attract penalties if goes ultra-vires. __________________________________________________________________________________________________________________________________

 

46) What is Articles of Association (AOA)?

AOA is more of an internal document for the company. It defines the matters relating to conducting the business of the company, procedure and limitations of altering the structure of the company. __________________________________________________________________________________________________________________________________

47) How do I register my MOA and AOA with the Government?

MOA and AOA are registered with the Government at the time of incorporating the company. An application is made through e-form 1, in which the MOA and AOA are attached and applied for approval. The requisite stamp-duty is to be paid depending on the state-wise Stamping Rules and authorized capital of the company. __________________________________________________________________________________________________________________________________

48) What are the forms that are filed to register a company?

Application form for availability or change of a name e- Form INC-1 Application or declaration for incorporation of a company (other than OPC) e- Form INC-7 Application or declaration for incorporation of a company (OPC) e-Form INC-2 Notice of situation or change of situation of registered office e-Form INC – 22 __________________________________________________________________________________________________________________________________

49) I wish to register my Company as an educational institute for non-profit organizations. What are the additional requirements for that?

In this case, a license has to be obtained in Form 24A to operate as a non-profit making organization. The said license is to be obtained after name approval of the company and before filing the incorporation forms as stated above.  __________________________________________________________________________________________________________________________________

50) I registered my company in Pune. However, in order to shift my operations, I wish to change my registered office to Bangalore. What is the process to do so?

It is a case of change in the jurisdiction of the RoC office. In case, company wants to shift the registered office from one state to another state, it needs to file following forms to give effect to such change. These forms are: 1) Form MGT-14 for filing of special resolution with the RoC. 2) File petition with CLB and intimate ROC in Form 61 3) Form 21 (Notice of the court or the company law board order) 4) Form INC-22 ( Notice of situation or change of situation of registered office) __________________________________________________________________________________________________________________________________

51) My company has been inoperative since it was registered. There has been no income and no expenses altogether. Do I still need to file the compliance forms with the department every year? Also, what are the compliance requirements for a company?

Yes. Although there have been no operations, the company has to still file the statement of accounts with the department every year. A company which has not filed its annual return for three consecutive years are considered in the strike off list of the department. Although the new Act has brought in the provisions enabling the company to operate as dormant, the said provisions are not yet applicable.  __________________________________________________________________________________________________________________________________

52) I wish to incorporate an IT company with three foreign nationals and two Indian nationals. I want to safeguard my interests in the company with respect to equity. What can I do?

The best option is to formulate and implement a shareholding agreement with vesting and cliff period clause.  __________________________________________________________________________________________________________________________________

53) Is Bank statement a valid address proof for obtaining DIN?

A latest bank statement duly attested by bank manager is considered as a valid address proof. __________________________________________________________________________________________________________________________________

 

54) What are the documents required for filing Form INC-7?

Following are the documents required for filing Form 1: Memorandum of Association (MOA) Articles of Association (AOA) Declaration from Promoters for Non-Acceptance of Deposits.
Declaration by a Practicing Professional that all the compliances pertaining to the Companies Act, 2013 has been complied with.
Declaration by the way of affidavits from the subscribers to the MOA & AOA.
Consent to Act as Directors. Any other optional attachment case-specific. Note: This list is not exclusive. __________________________________________________________________________________________________________________________________

55) What is the difference between incorporating a company in India and incorporating abroad?

In India, it does not matter in which city you are incorporating a company. Your company will be registered under the Central Government. There is one law and uniform applicability of its provisions nationwide. Unlike in foreign countries like US, wherein registration process and formalities are guided by state laws. __________________________________________________________________________________________________________________________________

56) Which address will be used while applying for the tax numbers of the company- the branch office or registered office?

The PAN and TAN numbers are to be applied using the registered office address proof while the address of the office from where the centralized billing is done is to be used for VAT and TIN numbers. __________________________________________________________________________________________________________________________________

 

57) I have already trade-marked the name “Abode” for my company. But Registrar of Companies has rejected the name and asked us to file new names. I want “Abode” as my brand name.What should I do?

Legal name of the entity and trademark registration are two different things. You may avail the registration for your private limited company with a different legal name and subsequently use the trade-mark on the desired name under the incorporated company with the different legal name.  __________________________________________________________________________________________________________________________________

58) What is my liability if I am appointed as a director in the registered company?

A director is the hand and brain of a company. A directors bears liability towards the company and third-parties. A director is answerable for breach of warranty and acts for his co-directors.  __________________________________________________________________________________________________________________________________

59) What are the things one should keep in mind while obtaining name for registering a company?

There are a lot of things that one should keep in mind before obtaining name for registering a company. The most important being “the choice of an unique name”. To explain this, the name should not be too identical to any existing Company Name or a registered trade-mark.  __________________________________________________________________________________________________________________________________

60) Which documents are considered as a valid address proof for registered office of a Company which is an owned property?

  • Tax Receipt.
  • Electric Bill (duly attested by professional).
  • Telephone Bill (only BSNL/MTNL or such nationalized telecom company).
  • Possession Letter.
  • Registered Property Ownership Deed.
  • Sale Deed.

__________________________________________________________________________________________________________________________________

61) Which documents are considered as a valid address proof for registered office of a Company which is an rented property?

  • Tax Receipt.
  • Electric Bill (duly attested by professional).
  • No Objection Certificate from Owner.

__________________________________________________________________________________________________________________________________

62) Can I attach my bank statement as an address proof for the registered office my Company?

You can only provide a bank statement which is of a nationalized bank, like SBI, after getting it attested by the bank manager. __________________________________________________________________________________________________________________________________

63) I am an Australian citizen, but resident in India. I want to apply for my DIN without my Australian address. I only have an Overseas Citizen of India (OCI) card. What will be my status while filing for DIN?

An OCI Card is equivalent to citizenship in India. Hence, if you do not want your Australian address to be put while applying in DIN, you can apply as a citizen of India, by virtue of the OCI Card. __________________________________________________________________________________________________________________________________

64) Who allots DIN?

Central Government (Office of Regional Director (Northern Region), Ministry of Corporate Affairs) will allot the DIN. __________________________________________________________________________________________________________________________________

65) What are the additional requirements for DIN of a foreign national?

All documents (including photo) shall be certified by the Indian Embassy or a notary in the respective country of the individual. __________________________________________________________________________________________________________________________________

66) What is the validity of a DIN ? Do we need to renew it?

DIN Number is a one time formality. It has a life-time validity. There is no requirement to renew it. __________________________________________________________________________________________________________________________________

67) Whether Provisional DIN can be used for e-filing?

No. Only an approved DIN can be used for e-filing. __________________________________________________________________________________________________________________________________

68) Can I introduce my wife as the second director of my Company?

Yes. You can introduce your wife or any other family member as the second director. __________________________________________________________________________________________________________________________________

69) I reside in Kerala. Can I opt for your services?

Definitely. The entire process of incorporation is managed electronically. Moreover, as per our service terms, complete confidentiality is assured with respect to the documents sent electronically. __________________________________________________________________________________________________________________________________

70) We applied for the name availability of a company. The spelling has been mis-spelled and the mis-spelled name is approved. Is there any way to change it since we do not want to continue with the wrong name?

You can apply for the name freshly along with an application to the concerned ROC, stating the grounds for applying for the fresh name. You can also provide the copy of the Letter of Correspondence of Name Approval along with the application. Alternatively, you can incorporate the company with the mis-spelled name and then apply for a change of the name of the company. __________________________________________________________________________________________________________________________________

71) Can an OCI Card holder be appointed as a director in a company? Can salary be paid to him?

Yes, an OCI Card holder can be appointed as a director in a company. Salary can also be paid to him and the salary will be taxable in India. __________________________________________________________________________________________________________________________________

72) What should be the minimum number of employees with which I should register my company?

There is no restriction on minimum number of employees. A company can be incorporated even with zero employee. __________________________________________________________________________________________________________________________________

73) I wish to register a company in pharmaceuticals. Is there any additional requirement for that?

You may need a license under the Food and Drug Administration Act. __________________________________________________________________________________________________________________________________

74) Can I register a company with software development, real estate and sales and marketing as the main objects?

The main objects of the company has to be absolute and not varied. Hence, you cannot register your company with all the above activities as main objects as they are not related to each other. __________________________________________________________________________________________________________________________________

75) I want to start a company with a specific word in its name. In future, I want to start more companies under the group, containing the same common words. Am I allowed to do so?

Yes. In case the future companies are not subsidiaries of the mother company, you will need a No Objection Certificate for incorporating the new companies. __________________________________________________________________________________________________________________________________

76) I am trying to check the availability of name for my company. But when I am entering the name, a blank box appears which says “undefined”. What am I doing wrong?

You are not doing any thing wrong. After entering the desired name, if the message displays “no records found”, then it means that the name is available. In case it is showing “undefined”, then it is due to some technical errors on the website. Please try again after some time. __________________________________________________________________________________________________________________________________

77) I have applied for the DIN of a company. Is my personal details accessible to the public? I do not want to share my personal contact numbers and e-mail IDs with the general public at large.

The personal details, namely the contact number and e-mail IDs that are entered in the DIN Form are only for the record purpose of the DIN department. They are not available for general display. The general public can only access the information related to your name, father’s name, date of birth, address and DIN number. __________________________________________________________________________________________________________________________________

78) What is CIN Number? Where can I find it?

CIN number means Corporate Identification Number. It is like the identity number of the company. You can find it in the Certificate of incorporation of the company. __________________________________________________________________________________________________________________________________

79) In what form should I send you all the documents for registering a company? Do I need to send you the hard-copies of the documents via courier?

Just like the MCA, all our services are managed electronically. Hence, you can attach the document as a PDF, GIF, JPG, BMP, PNG or TIF. Moreover, you do not need to send us any hard copies. __________________________________________________________________________________________________________________________________

80)Am I registering my company under new act or old act?

You are registering your company in transition between the new Act and the old Act. This is owing to the fact that the new Act is not wholly implemented yet. 98 sections of the Act has been notified by the Department. __________________________________________________________________________________________________________________________________

81) Is there a minimum and maximum age for being Director of a Company?

There is no maximum age for being a director in a company. However, the minimum age is 18 years. __________________________________________________________________________________________________________________________________

82) Why should I get my logo trademarked?

For the simple reason of protecting it. Once you trademark your logo, no one else will be able to use it. It also provides for other benefits in the form of creation of brand equity and identity.

Topic of the page:

FAQ ON COMPANY REGISTRATION IN PATNA-COMPANY REGISTRATION RANCHI-COMPANY REGISTRATION PROCEDURES IN PATNA-RANCHI-FREQUENTLY ASKED QUESTIONS



Article written and compiled by: ACS Prince Kunal

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6. www.indiannbfcproducercompanyregistration.in
7. www.corporatelegalguru.com
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9. www.websitemaniac.in

 

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