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Incorporation of Private/ Public Limited Company:

Benefits of Incorporation of Company:

  1. Company is an entrepreneur artificial body with perpetual succession.
  2. It is independent of its directors and Shareholders.
  3. The liabilities of shareholders of the company are limited to the extent of their Shareholdings in the company.
  4. The Board of Directors have full control over the business of the Company even without 100% (but over 50%) shareholding. Particularly beneficial to projects where large capital investment is required. Also beneficial for non-residents & foreign investors owned projects where 100% shareholding is not permissible due to Sectoral Cap.

Requisites for incorporation of Company:

  1. The minimum no. of Shareholders in private limited Company is two and seven for public limited company.
  2. The maximum no. of shareholders in the Private limited company cannot exceed 200. There is no limit on the maximum no. of shareholders in public limited company.
  3. The minimum no. of directors in a private limited company are two and for a public limited company are three.
  4. The maximum no. of directors can be fifteen.
  5. There is no minimum paid up Capital requirements (Previously it was Rs. One Lac.)
  6. The Company must have a Registered Official.
  7. The Company must have its own Memorandum and Articles of Association which is the Charter of the Company.
  8. The Articles of Association defines the internal regulation of the company and its management.
  9. Every director of the company, whether Indian and foreigner must get the Director Identification No. (DIN) and Digital Signature Certificate (DSC). DSC is digital equivalent of normal written signature.
  10. The address of the registered office premises can be commercial/ industrial/ residential where the communication can be received.
  11. One of the directors must stay in India for at least 182 days during the financial year.