A Limited Liability Partnership (LLP) is a combination of a Partnership and a Company governed by the Limited Liability Partnership Act 2008. LLP is a special partnership that offers protection to each partner against any negligence on behalf of the other partners.

Table of Contents

  • Advantages of LLP

  • Procedure of LLP Incorporation

  • Documents Required for Obtaining DSC

  • Documents Required for Obtaining Director Identification Number

  • Incorporation Method

  • Requirements for Filing LLP Form 1

  • Proposed Monetary Value of Partner's Contribution

  • Drafting of LLP Agreement

  • Filing of Form 3 LLP Agreement

Advantages of LLP

1. Liability Protection: The liability protection provided by an LLP is a significant advantage. Individual partners are not held personally responsible for any company debts or obligations. Any lawsuit or claim against the company cannot be held against the partners, thus protecting personal assets.

2. Flexibility: Partners have flexibility within business ownership under an LLP. Each partner in the business can decide their level of contribution and involvement. They are also not obligated to participate in business meetings or consultations unless they wish to.

3. Tax Advantages: Partners are liable for filing their personal income and self-employment taxes. The partnership itself is not responsible for paying these taxes. The company's credits and deductions are divided among the partners according to their interest in the company.

Procedure of LLP Incorporation

MINIMUM REQUIRMENT

  • Minimum 2 partners
  • DSC (Digital Signature Certificate ) of the Directors
  • DIN(Director Identification Number) of the Directors
  1. Obtain DSC

Obtain a Digital Signature Certificate from Authorized DSC issuing Authority.

Documents required for obtaining DSC :

Proof of Identity

Proof of Residence

One self attested passport size photograph

Obtain DIN

An application is to be made in Form DIR-3 to obtain the directors' DIN numbers after obtaining the DSC.

Documents required for obtaining Director Identification Number:

  • Scanned copy of Passport-sized photograph( JPEG Format)
  • Identity proof: Scanned copy of PAN card (passport if foreign national) and
  • Address Proof: Driver's License/Voter ID/ Utilities Bill not more than two months old from the date of filing. Documents should be self-attested.

Register DSC

After obtaining the DIN number, register the DSC on the MCA portal in the name of the Designated Partner/Director. Navigate to MCA services -> DSC Services -> Register DSC.

Incorporation Method

Name Approval (Form 1)

Apply in Form INC-1 for name approval of the proposed LLP after finalizing the nature of business of the proposed LLP. A maximum of six names can be given in order of preference. CRC will approve the available and suitable name among the given names for the proposed LLP.

Note: Applicants can themselves check the available names on the MCA Website under MCA Services: Check LLP Name.

Once the proposed Company's name is approved, it remains valid for 3 months from the date of approval. Within these 3 months, LLP must be incorporated; otherwise, name approval in LLP Form 1 must be filed again with MCA.

Requirements for filing LLP Form 1

  • DPIN/DIN of two designated Partner
  • Name of the Proposed LLP
  • Description of proposed business activity

Proposed monetary value of partner's contribution

Once the proposed monetary value of the partner's contribution is filled out and filed in Form 1, the contribution's monetary value in Form 2 should not be less than the value mentioned in Form 1.

LLP Form 2 (Incorporation Document and Subscriber's Statement)

LLP Form 2 must be filed within 3 months from the date of approval of LLP Form 1.

Drafting of LLP Agreement

The LLP agreement has to be drafted in accordance with the LLP Act. It is not mandatory to file the agreement at the time of registration and can be filed within 30 days. Designated partners are responsible for compliance with the provisions of the LLP Act. Professional help is recommended for drafting the agreement.

Filing of Form 3 LLP Agreement

The LLP agreement has to be uploaded. Once approved, all formalities for registration are completed.

Note: Form 3 must be uploaded within 30 days of the LLP's incorporation; otherwise, a penalty of Rs. 100/—per day applies.

Contact ADCA

For expert assistance in company registration and LLP incorporation, contact ADCA, one of the leading providers of company registration services in Bangalore.

FAQs

Is registration of LLP compulsory?

Yes, registration of an LLP is compulsory under the LLP Act, 2008.

How to incorporate an LLP?

An LLP can be incorporated by following the procedure of obtaining DSC and DIN, filing for name approval, and submitting incorporation documents.

What is an LLP registration number?

An LLP registration number is a unique identification number issued upon the successful registration of an LLP.

What is a valuation certificate in LLP incorporation?

A valuation certificate is a document that certifies the value of a partner's contribution in an LLP, often required during the incorporation process.

What is an LLP identification number?

An LLP identification number (LLPIN) is a unique number assigned to an LLP upon incorporation.

How to check LLP company name availability?

You can check LLP company name availability on the MCA website under MCA Services: Check LLP Name.

How to get company CIN/FCRN/LLPIN/FLLPIN?

These identification numbers can be obtained from the MCA portal upon successful registration of the company or LLP.

What is LLP Form 3?

LLP Form 3 is the form used to file the LLP agreement with the Registrar.

How much does LLP registration cost in Bangalore?

LLP registration costs in Bangalore vary based on professional fees, government fees, and other associated costs. Contact ADCA for a detailed cost estimate.

The advertisement charges for advertising on google, facebook, Linkedin and other digital advertising platform are usually paid out of india in foreign currency, though entire advertising activity happens in india, and escapes any taxation in India.

The Indian Finance Minister Sri Arun Jaitly has introduced the equalization levy with effect from june 1, 2016. The provision for equalization are provided in Chapter VIII of the Finance Act 2016.

Brief summary of Provisions are as follows :

Rate of tax and Services Covered :

 The equalization levy would apply @ 6% on amount paid or payable  for Online advertisement, any provision for digital advertising space or any facility service for the purpose of online advertisement or any other service as may be notified later by government. Levy is applicable on amount paid or payable for above services to non-resident.

The scope of the levy may be expanded to cover a wider range of digital goods and services as time progresses.

Equalization levy is aimed at taxing business-to-business (B2B) e-commerce transactions. Levy is not applicable  where payment is  not for the purposes of carrying out business or profession.

Levy is not applicable if aggregate of payment to a non resident during the financial year does not exceed Rs 1 lakh.

Collection and deposit and filing of return :

The said tax of 6% is required to be deducted from the amount paid or payable to non-resident for specified services.

Tax so deducted is required to deposited on a monthly basis within 7th of following month. Interest at the rate of 1 % per month or part of month is applicable for delayed deposit of taxes.

Annual statement with respect to levy is required to filed with specified period form end financial year in which service are provided. To rectify any mistake or omission in the statement filed revised statement can be filed within 2 years from end of financial year in which service is provided. Statement will be processed and intimation for any demand or refund will be sent with in end of 1 year from the end of financial year in which statement is filed. Any mistake in such intimation can be rectified within one year from the end of financial year in which intimation was issued.

Penalty :

Non deduction of equalization of levy would attract penalty equal to amount of equalization levy in addition to payment of equalization levy and interest on delayed payment.

Where Equalization Levy is deducted but not deposited with government would attract penalty of Rs 1,000 per every day during which such failure continues. This penalty is subject to maximum limit of equal to amount of equalization levy.

Non filing of annual statement would attract penalty of Rs 100 for each day during which the failure continues.

No penalty shall be imposed where assessee proves to the satisfaction of the Assessing Officer that there was reasonable cause for the said failure.

Chapter provides for appeal to Commissioner ( appeals) and to Income Tax Tribunal against order levying penalty.


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Section 2 (42A) provides that short term capital asset means a capital asset held by an assessee for not more than thirty six months immediately preceding the date of its transfer.

It is provided that in the case of a security ( other than a unit) listed in a recognised stock exchange in indiaor a unit of the unit trust of india established under the Unit Trust of India Act, 1963 or a unit of an equity oriented fund or a zero coupon bond, the provisions of this clause shall have effect as if for the words " thirty Six Months" the words " twelve months" had been substituted. 

The Finance Act, 2016 has inserted a third proviso to section 2 (42A) from the assessment year 2017-18 so as to provide that in the case of a share of a compnay ( not being share listed in a recognised stock exchange in India), the provisions of section 2 ( 42A) shall have effect as if for the workds " thirty Six Months"  the words " Twety Four Months " had been substituted.

The learned author identifies the amendments introduced by the finance act 2016 which impact corporate sector. he discussion is not confined only to provisions exclusively applicable to companies. some provisions which apply to companies and non company assessees have also been discussed.

1.Introduction

Corporate sector is an integral part of the company of a country and india can be no exception. this sector, besides contributing substantial revenues to the Govt.'s kitty, also enriches the GDP of the country year-after-year. Hence, its natural that each year's Finance acts have number of provisions concerning Corporates. In later paragraphs, an account of the provisions contained in the Finance act 2016, specifically applicable to companies are discussed and measures also applicable to companies.

2.Finance act provisions concerning corporate sector

These, in brief, are us under

(1)Lower tax rate for companies

     In the previous year's budget ,the FM had announced that in a period of next  4 years, he would bring down the rate of corporate tax to 25% from 30%. He has made a beginning for this year's budget. the proposal is that new manufacturing companies incorporated  on or after march 1, 2016 will have an option either to adopt a reduced corporate tax of 27.55%(Where the income exceeds Rs. 1crore but does not exceed  Rs. 10crore)or 28.84% (where income exceeds 10crore) provided such companies do not claim profit linked /invest linked deduction or do not avail of investment allowance and accelerated depreciation. The new startup companies who do not wish to claim any exemption can straight away claim tax rate of 25%. The conditions to avail of 25% rate are:

(a)The company should be set up and registered on or after 1st day of march, 2016;

(b) the company should be engaged in the business of manufacture or production of any article or thing and is not engaged in any another business;

(c)the company while computing its total income has not claimed any benefit under section 10AA, benefit of accelerated depreciation, benefit of additional depreciation, investment allowance, expenditure on scientific research and any deduction in respect of certain income under part-C of chapter 6-A Other than the provisions of section 80JJAA; and

(d) the option is furnished in the prescribed manner before the due date of furnishing the return of income.

    The issue is as to how the corporates will react to such proposals. The initiative seems to have been taken to give a boost to the manufacturing units in the country and make in india programme of the P M a success. But, the scheme is not expected to be enthusiastically welcomed in view of the fact that heavy capital is needed for manufacturing units and they may not like to continue with higher rates with incentives , which effectively bring down the rates to nearly 24%.

(2)Other amendments

      (1)new startups, involving innovation development , setup before april1,2019 will get 100% deduction of profits for a period of 3 years out of 5 years (subject to satisfaction of certain conditions ). However, the MAT would be applicable on such startups.  some conditions have already been started earlier . Others relate to benefit -under section 54E&54GB.

  (2)Effective corporate tax rate for small companies having  turnover less than 5crore is reduced to 31.96%. the reduced corporate is expected to lead growth of such companies.

  (3)the act taxes long term capital gains in the hands of non residents @10% which arise from the transfer of unlisted shares of a company in which public are not substantially interested, i.e. private companies. this ensures taxability of gains arising from transfer shares of unlisted companies and likely to incentivize corporate reorganization in india.

(4)If an assessee purchases a luxury car exceeding the price of  Rs.10lakhs or purchase goods or avails of services exceeding 2lakhs in cash, tax at source is to be collected @1% This measure is intended to provide money trail and give clues regarding black money invested in such assets.

(5)The existing provision of sub-section (1A) in section 32AC of the act provides for investment allowance at the rate of 15% on investme4nt made in new assets (plant and machinery) exceeding Rs.25crore in a previous year  by a company engaged in manufacturing or production of any article or thing subject to the condition that the acquisition and installation has to be done in the same previous year. this tax incentive is available up to 31-3-2017.

          The dual condition of acquisition and installation can cause a genuine hardship in cases in which assets having been acquired could not be installed in same previous year . Hence sub section (1A ) in section 32AC has been amended so as to provide that the acquisition of the plant $machinery of the specified value has to be made in the previous year. However installation may be made by 31-03-2017.

            The dual condition of acquisition and installation can cause genuine hardship in case in which assets have been acquired could not be installed in same previous year. Hence sub section (1A) of section 32AC has been amended so as to provide that the  acquisition of the plant &machinery of the specified values has to be made in the previous year .however , installation may be made by 31-03-2017 in order to avail the  benefit of investment  allowance of 15%. It is further provided that where the installation of the new asset in a year or other than the year of acquisition, the deduction under this sub section  shall be allowed in the year in which the new asset is installed.

(6) A person resident in india or a non resident having a permanent establishment in india , making payment exceeding in aggregate Rs.1lakh  in a year towards online advertisement to a non resident, who does not have a permanent establishment in india would have to withhold  tax at 6% of gross amount paid ,as an equalisation levy which is to discharged by way of withholding this provision is intended to bring alignment of domestic tax law with OECD recommendation on BEPS on digital economy . this provision would impact the income of non  resident e-commerce giants providing online advertisement services (such as Google, yahoo, etc...)or other services to the companies in india     


Contact ADCA to know more about corporate taxation. ADCA is CA firms in Bangalore, whose Service is based on Client Value addition & Client Satisfaction.

Government has vided notification no 30/2016 dated 29.04.2016  has revised the due date for filing TDS statement by deductors as follows :   

     Sl No

Quarter Ending

Due date

1

June 30.

July 31st of Financial Year

2

September 30.

October 31st of Financial Year

3

December 31.

January 31st of Financial Year

4

March 31.

May 31st of following Financial Year

1. INCREASE IN THRESHOLD LIMIT FOR TDS UNDER VARIOUS SECTION IS AS FOLLOWS :

Present Section

Heads

Existing Threshold
Limit (Rs.)

Proposed Threshold Limit
(Rs.)

1 92A

Payment of accumulated balance due to an employee

30,000

50,000

194BB

Winnings from Horse Race

5,000

10,000

194C

Payments to Contractors

Aggregate annual limit of 75,000

Aggregate annual limit of 1,00,000

194LA

Payment of Compensation on acquisition of certain Immovable Property

2,00,000

2,50,000

194D

Insurance commission

20,000

15,000

194G

Commission on sale of lottery tickets

1,000

15,000

194H

Commission or brokerage

5,000

15,000

 

2. REVISION IN TDS RATES :

Present Section

Heads

Existing Rate
of TDS (%)

Proposed Rate of
TDS (%)

194DA

Payment in respect of Life Insurance Policy

2%

1%

194EE

Payments in respect of NSS Deposits

20%

10%

194D

Insurance commission

Rate in force (10%)

5%

194G

Commission on sale of lottery tickets

10%

5%

194H

Commission or brokerage

10%

5%

 

 

 

 

 

 

 

 

 

 

3. EXEMPTION FROM REQUIREMENT OF FURNISHING PAN TO NON RESIDENTS:

Section 206AA provide that in case deductee doesnot furnish PAN, tax need to be deducted @ 20%. This provisions were applicable to payments to non resident and foreign companies as well. Hence taxes were required to be deducted @20 % on foreign remittance though DTAA provided for lesser rate as invariably the foreign companies did not have PAN.  Amendment to section 206AA provides much sort exemption to Non Residents and Foreign Companies from requirement of furnishing PAN. This exemption has come into effect from June 1st, 2016.

4.  Form 15G/ 15H made applicable to TDS on Rent under section 194I.

Till now a person receiving interest income was entitled to furnish form 15G/ 15H to payer of interest to avoid deduction of  TDS on interest. 15G/ 15H is declaration stating that total income of payee for the year will be below the threshold limit of income subject to tax and hence there will not any income tax liability.

From June 1st form 15G / 15H has been made applicable to deduction of tds u/s 194I, the receiver of rent can provide a declaration in form 15G/15H to payer of rent and claim exemption from deduction of tds from rental receipts.

5. CHANGES IN DUE DATES FOR FILING OF TDS RETURN AND ISSUE OF TDS CERTIFICATES :

This changes is effective for TDS return due after June 1st, 2016

6. TCS PROVISIONS EXTENDED TO SALE OF GOODS AND SERVICES  :

TCS @ 1% has been made applicable to below from june1st 2016:

a. Sale of Motor vehicle of the value exceeding Rs 10 lakhs whether amount is received in cash, cheque or any other mode.

b. Sale in cash of any goods ( other than Bullion and Jewellery) or providing of any services (  other than payments on which tax is deducted at source  under tds provisions)  of value exceeding Rs 2 lakh, where sale consideration has been received in cash .

The revised tcs chart with effect from June 1st 2016, is as follows :

Nature of Goods

TCS Rate

Alcoholic liquor for human consumption

1%

Tendu Leaves

5%

Timber obtained under a Forest Lease

2.5%

Timber obtained by any mode other than Forest Lease

2.5%

Any other Forest produce not being forest timber or tendu leaves

2.5%

Scrap

1%

Minerals being Coal or Lignite or Iron ore

1%

Parking Lot, Toll Plaza, Mining and Quarrying

2%

Where ANY amount of consideration is received in cash on sale of :- Bullion (consideration exceeds Rs. 2 Lakhs), Jewellery (consideration exceeds Rs. 5 Lakhs), and with effect from June 1,2016,Any other goods and services (exceeding Rs. 2.00 Lakh) if TDS Provision is not applicable

1%

Where amount is received by cheque or any other mode on sale of :- Motor vehicle of the value exceeding Rs. 10.00 Lakh (applicable from June 1,2016)

1%

 


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Central Board of Excise and Customs had vide order no 1/2016- Service Tax Dated 25.04.2016 has extended due date for filing ST-3 Return for the period Oct to March 2016 period from 25.04.2016 to 29.04.2016. There has been difficulties in accessing return filing website www.aces.gov.in due to which this extension has been given.

CS Sweta Abhishek

This article is an attempt to share my experience and to provide a brief knowledge of Company Incorporation/Formation/Registration procedure not only to my professional colleagues/friends but also to the entrepreneurs looking to set up their businesses in India.

Table of Contents

1. Private company
2. Public company
3. Procedure for incorporation/registration/formation of a company
4. New incorporation method
5. Regular incorporation method

A Company is an Artificial person in the eye of law. A company need to get incorporated/Registered to get a position of legal entity.

As per Companies Act, 2013 Minimum requirement to incorporate a Company requires the following:

Private Company:

 A Private Limited Company is a Company limited by shares in which there can be maximum of 200 shareholders, no invitation can be made to public for subscription of share and debenture, there is restriction on transfer of shares and cannot accept deposits from public.

MINIMUM REQUIRMENT

  • Minimum 2 Directors

           As per Companies Act, 2013, every company shall have atleast one Indian Director i.e. who has stayed in India for a period of 182 days or more in the previous calendar year.

  • Minimum 2 Shareholders

           Directors and Shareholders can be the same persons

  • Minimum Share Capital

          Minimum share capital shall be Rs. 1,00,000 (INR One Lakh)

  • DSC (Digital Signature Certificate ) of  the Directors
  • DIN(Director Identification Number) of the Directors

Public Company:

A Public Limited Company is a Company limited by shares in which there is no restriction on the maximum number of shareholders, transfer of shares and acceptance of public deposits.

MINIMUM REQUIRMENT

  • Minimum 3 Directors

           As per Companies Act, 2013, every company shall have atleast  one  Indian Director i.e. who has stayed in India for a period of 182 days or more in the previous calendar year.

  • Minimum 7 Shareholders
  • Minimum Authorised Share Capital of Rs. 5 Lacs
  • DSC (Digital Signature Certificate ) of  the Directors
  • DIN(Director Identification Number) of the Directors

PROCEDURE FOR INCORPORATION/REGISTRATION/FORMATION OF A COMPANY

Obtain DSC (Digital Signature Certificate)

          Obtain a Digital Signature Certificate from Authorized DSC issuing Authority.

          Documents required for obtaining DSC :

  •  Proof of Identity
  • Proof of Residence
  • One self attested passport size photograph

           Obtain DIN

          Application to be made in Form DIR-3 for obtaining the DIN no. of the Directors after obtaining the DSC.

         Documents required for obtaining Director Identification Number:

              1. Scanned copy of Passport-sized photograph (JPEG Format)

             2. Identity proof: Scanned copy of PAN card (passport if foreign national) and

            3. Address Proof: Driver’s License/Voter ID/ Utilities Bill not more than two months old from the date of filing. Documents should be  self-attested.

Note:

if DIN is applied for Foreign national: Details of a valid passport should be filled in form DIR-3 and a certified copy of same should be attached with DIN application. All supporting documents including photograph should be certified by the Indian Embassy or a notary in the home country of the applicant or by the Managing Director / CEO / Company Secretary of the company registered in India, in which applicant is a director. If a foreign director has a valid multiple-entry Indian visa or Person of Indian Origin card or Overseas Citizen of India card, then the attestation could also be done by Public Notary / Gazetted Officer in India or practicing CA / CS / CWA.

           Register DSC

          After obtaining the DIN No. register the DSC on MCA portal in the name of Director. In MCA portal go to MCA services-DSC Services-Register DSC.

Companies Act, 2013 provides two ways by which a Company can be incorporated:

  1.  New Fast Track Company Incorporation method (Form INC-29 Integrated Form for Incorporation)
  2. Regular Incorporation method (Form INC-1, Form INC-7, Form DIR-12 & Form INC-22)

 

NEW INCORPORATION METHOD:

MCA has tried to simplify the Incorporation procedure by introducing Form INC-29, an integrated form in which on a one go applicant can apply for the following:

1.Name Availability

 Form INC-29 allows to apply for only One name (Make sure that proposed name is available by checking Name availability in MCA portal and adhere to the Companies Act, 2013 and rules thereunder (Naming Guidelines) and Companies (Incorporation) Amended Rules, 2016)

2.Apply DIN for Maximum of 3 Directors

One of the Director of the proposed Company must contain DIN No. before filing and for other Directors (max 3 Directors) of the Company  can apply DIN in the integrated form.

Example: if there are 4 Directors in the proposed Company and none of the Director is having a DIN then out of 4 directors, 1 Director should apply DIN by applying in Form DIR-3 and rest of the 3 Directors DIN can be applied in the Form INC-29.

3. First Directors of the Company

4. Incorporation of Company

5.Situation of Registered office

6.Application of PAN

7.Application of TAN

8.Employer Registration under ESIC

Incorporation Documents to be attached in Form INC-29:

1. MOA (Memorandum of Association)

                  The Memorandum of a company shall be adopted in the specified form of Schedule I (Table A,B,C,D,E as applicable) of the Companies Act, 2013

2. AOA (Article of Association)

                  Article of the Company shall be adopted in the specified form of Schedule I (Table F,I,J as applicable) of the Companies Act, 2013

3. Identity proof and Residential Proof of the Directors who applied for DIN

4. Identity proof and Residential Proof of the Subscribers

5. Proof of Registered Office

       1.No Objection Certificate from the Owner

      2.Rent Agreement/Lease Agreement etc.

      3.Utility Bill (Not more than 2 months old from the date of filing)

6. Declaration by Professional- INC -8

7. Affidavits and Declaration by the First Subscribers and Directors:

  • INC-9-Affidavit from the Subscriber to the Memorandum (MOA)
  • INC-10-Verification of Signature of subscribers
  • DIR-2-Consent to become a Director of the said Company
  • Affidavit under Circular 11/2013

Note: The Memorandum of a company shall be adopted in the specified form of Schedule I (Table A,B,C,D,E as applicable) of the Companies Act, 2013 and Article of the Company shall be adopted in the specified form of Schedule I  (Table F,I,J as applicable) of the Companies Act, 2013.  

Subscriber Sheet of MOA & AOA: Last page of MOA and AOA consist of Subscriber sheet in which the  following details of the subscribers to the MOA and AOA need to be mentioned:

  • The MoA and AoA shall be signed by each subscriber to the memorandum, who shall add his name, address, description and occupation in his own handwriting in the presence of at least one witness and shall contain photo of each individual subscriber.
  • Witness Signature along with Name, Address, Occupation and Membership No. (if any). The witness shall state that:

“I witness to subscriber/subscriber(s), who has/have subscribed and signed in my presence (date and place to be given); further I have verified his or their Identity Details (ID) for their identification and satisfied myself of his/her/their identification particulars as filled in”

  • If the subscriber is illiterate, he should affix his/her thumb impression or mark which shall be described as such by the person, writing for him, who shall place the name of the subscriber against or below the mark and authenticate it by his own signature and he/she shall also write against the name of the subscriber, the number of shares taken by him/her. Also such person shall also read and explain the contents of the MoA and AoA to the illiterate subscriber and make an endorsement to that effect on the MoA and AoA.
  • Where the subscriber to the memorandum is a body corporate, the MoA and AoA should be signed by director, officer or employee of the body corporate duly authorized in this behalf by a resolution of the board of directors of the body corporate and where the subscriber is a Limited Liability Partnership (LLP), it should besigned by a partner of the Limited Liability Partnership, duly authorized by a resolution approved by all the partners of the LLP. However in either case, the person so authorized shall not, at the same time, be a subscriber to the memorandum and articles of Association.

Payment of ROC Fee & Stamp Duty

After Uploading the Form INC-29 , one need to make payment of RoC fees and Stamp Duty electronically as per  the Authorised Capital of the Company .

Verification of Documents

RoC scrutinises all the documents and forms and may suggest few changes as per the requirement. In such case, required changes has to be made by the Applicant and resubmit the form .

Incase of INC-29, only two resubmissions are allowed. If after two resubmission still some changes were found by RoC then fresh form need to be submitted along with RoC fee and Stamp Duty again.

Issue of Certificate of Incorporation

RoC approves the Incorporation of the proposed Company, when after scrutiny, RoC is satisfied with the Form and its attachments and issues "Certificate of Incorporation". Once the Incorporation Certificate is received , Company can start its Business.  

REGULAR INCORPORATION METHOD

1. DIN Application

Obtain Director Identification Number for all the Directors of the proposed Company. Apply In Form DIR-3.

2. Name Approval (FORM INC-1)

Apply in Form INC-1 for Name approval of the Proposed Company after drafting the Main Object/ nature of Business of the proposed Company. Maximum Six names can be given in order of preference. RoC will approve the available and suitable name among the given names for the proposed Company.

Note:

 Name should be selected as per the Companies Act, 2013 and Rules made thereunder. Applicants can themselves check the available names in MCA Website under the head MCA Services: Check Company Name. Name of the proposed Company should not fall under "Undesirable names" as mentioned in Companies (Incorporation) Rules, 2014 and Companies (Incorporation) Amendment Rules, 2016 .

Once name of the proposed Company is approved, it remains valid for 60 days from the date of approval.  Within the said period of 60 days, Company has to be incorporated otherwise again name approval in Form INC-1 is required to be filed with MCA.

3. Draft MOA & AOA

Before Incorporation, MOA (Memorandum of Association) and AOA (Article of Association) of the proposed Company is drafted and printed. The Memorandum of a company shall be adopted in the specified form of Schedule I (Table A,B,C,D,E as applicable) of the Companies Act, 2013 and Article of the Company shall be adopted in the specified form of Schedule I  (Table F,I,J as applicable) of the Companies Act, 2013.

Subscriber Sheet of MOA & AOA: Last page of MOA and AOA consist of Subscriber sheet in which the  following details of the subscribers to the MOA and AOA need to be mentioned:

  • The MoA and AoA shall be signed by each subscriber to the memorandum, who shall add his name, address, description and occupation in his own handwriting in the presence of at least one witness and shall contain photo of each individual subscriber.
  • Witness Signature along with Name, Address, Occupation and Membership No. (if any) of the witness. The witness shall state that:

“I witness to subscriber/subscriber(s), who has/have subscribed and signed in my presence (date and place to be given); further I have verified his or their Identity Details (ID) for their identification and satisfied myself of his/her/their identification particulars as filled in”

  • If the subscriber is illiterate, he should affix his/her thumb impression or mark which shall be described as such by the person, writing for him, who shall place the name of the subscriber against or below the mark and authenticate it by his own signature and he/she shall also write against the name of the subscriber, the number of shares taken by him/her. Also such person shall also read and explain the contents of the MoA and AoA to the illiterate subscriber and make an endorsement to that effect on the MoA and AoA.
  • Where the subscriber to the memorandum is a body corporate, the MoA and AoA should be signed by director, officer or employee of the body corporate duly authorized in this behalf by a resolution of the board of directors of the body corporate and where the subscriber is a Limited Liability Partnership (LLP), it should be signed by a partner of the Limited Liability Partnership, duly authorized by a resolution approved by all the partners of the LLP. However in either case, the person so authorized shall not, at the same time, be a subscriber to the memorandum and articles of Association.

4.Incorporation of Company

For incorporation of the Company, applicant is required to submit  Form INC-7(Application for Incorporation of Company), Form DIR-12 (Appointment of Directors) & Form INC-22 (Situation of Registered Office of the Company) together.

Document to be attached in Form INC-7 (Application for Incorporation of Company)

            1. MOA (Memorandum of Association)

            2. AOA (Article of Association)

           3. INC -8-Declaration by Professional(CA/CS/CMA)

           4. INC-9-Affidavit from the Subscriber to the Memorandum (MOA)

           5. INC-10-Verification of Signature of subscribers

           6. Affidavit under Circular 11/2013

           7. Identity proof and Residential Proof of the Subscribers

          8. PAN Card of the subscribers

Document to be attached in Form DIR-12 (Appointment of Directors)

        1. DIR-2-Consent to become a Director of the said Company

        2. INC-9-Affidavit from the First Director in the AOA

Document to be attached in Form INC-22 (Situation of Registered Office of the Company)

         1. No Objection Certificate from the Owner

         2. Rent Agreement/Lease Agreement/ Sale Deed

         3. Utility Bill (Not more than 2 months old from the date of filing)

NOTE:  

  • If the proposed Company registered office is same as any existing Company, NOC  in form of Board Resolution is required from the existing company.
  • Form INC-22 to be filed within 15 days of incorporation of the company, either if, address of correspondence as mentioned in INC-7 is not the address of registered office of the Company or it has not been not filed along with incorporation form.

5.Payment of ROC Fee & Stamp Duty

After Uploading the Form INC-7, INC-22 & DIR-12 , applicant need to make payment of RoC fees and Stamp Duty electronically as per  the Authorised Capital of the Company .

6.Verification of Documents

RoC scrutinises all the documents and forms and may suggest few changes as per the requirement. In such case, required changes has to be made by the Applicant and resubmit the form .

 7.Issue of Certificate of Incorporation:

RoC approves the Incorporation of the proposed Company when after scrutiny RoC is satisfied with the Form and its attachments and issues "Certificate of Incorporation". Once the Incorporation Certificate is received, Company can start its Business.  

Legal Disclaimer:

The information/articles & any reply to the Comments in this blog are provided purely for informational and educational purpose only and purely based on my understanding/Knowledge. They do not constitute legal advice or legal opinions.


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