Company Registration in India – With New 2018 Procedure

From 26th January 2018, the company registration in India has been completed revolutionized by the government of India to compete at the international level and to improve the ease of doing business in India.

The process has been made very fast, cheap and secure. For any person in India, who wants to start a business in India, company registration will not take much of the time and hence, they can plan it well.

Nowadays, company registration procedure will take around 7 to 8 days to register and may cost you around 9 to 11 thousand. Let us now understand the key highlights of the changes made and the new and free company registration process.

Key Highlights of changes made by the Govt

Here are key highlights of the changes made by the Ministry of Corporate Affairs (MCA) w.e.f 26th January 2018:

• Fees for final submission of company registration form have been reduced. This will result in a reduction of company registration cost by Rs.3,000/- to 25,000/- depending on the type of company you form.
   
• The final form fee waiver is only for companies formed with authorized capital up to Rs.10 lakh.
   
• There will be no need for DIN and DSC up to name approval process. Once the name is finalized, DIN can be applied directly via SPICE incorporation form.

As said, there are many other small changes has been made, which you will observe once we discuss the procedure in detail. However, before going forward with company registration procedure, let us first discuss a company registration checklist in brief:

Company registration checklist

Before going forward with company registration, you must discuss the following points:

• Number of founders: Selecting founding members is the most important task. This is because founding members cannot be changed at a later stage. You must also decide as to how you should split the equity shares, because equity has the direct correlation with the ownership of the company.
   

• Documents collection: Collect all the requisite documents of the founding members and get it ready. Read the documentation details below.
   

• Name selection: Once your founding team is established, the next thing you do is to select a company for your company. The name must be unique and you can follow the below-mentioned guidelines for name section.
   

• Capital requirement: After finalizing your company name, the next thing you must do is to finalize the capital to be invested.
   

• Registered office: Once you have finalized the capital requirement, the next thing you should do is to finalize your office according to your budget. This is because you will need an address for registering a company. You can do this even at your home address if you don’t have any office.

Documents required for Company registration

Documents required for the private limited company has not been changed. There is a predefined set of documents which is required for company registration. Here is the list of documents required for every member of the proposed company:

• PAN Card
• ID Proof (Voter ID, DL, Passport, Aadhar card – Anyone)
• Address Proof (Bank statement, Elect bill, mobile bill, landline bill – anyone)
• Passport size photo

Apart from the above list of documents, there are additional documents required the registered office of the company:

• Rent agreement (in case premises are on rent)
• Ownership proof
• Electricity bill
• NOC

Here are few guidelines for documentation part of company registration:

• All documents must be submitted on the scan. No hard copy is required.
• Scan copy of documents must be clear and visible.
• Do not temper or alter any scanned document. It is punishable under the law.
• Make sure your PAN card contains your correct and complete name (i.e. name with surname).

New Company Registration – Procedure, Cost, and timelines

After collecting reading the checklist for company registration and getting the collecting all the documents, we can now proceed to company registration procedure.

 

1. Apply for Digital Signatures Certificates (DSC)

The first step is to apply for digital signature (commonly known as DSC). Digital signatures are prepared for each and every promoter because all the details are authenticated using the DSC.

Here is the following procedure; you may follow for getting the digital signatures:

• Select the DSC service provider like mudra or Sify, whosoever giving you good services.
• Fill up the form and submit the application along with ID proof
• Pay the required fees (Rs.600 to Rs.1200).
• Wait for a day to generate.

Once digital signature is done, we can proceed to next step or even you can simultaneously go to the next step.

2. Company name check

The next step you should do is to finalize the name and file the same for approval. This is one of the most important parts of company registration procedure because the name is everything in business. The name will depict your brand, your domain name, your visiting cards etc. Hence, you must choose it wisely.

Further, make sure that you follow these guidelines to have unique name which could be approved by the ministry of corporate affairs

• Company name search: Once you have mutually decided the company name, then the next step is to check the company name, whether the same is available or not. The Company name search happens at mca website.  
   

• Trademark Search: The next thing is to do is to search whether your proposed name is trademarked or not. Trademark search is the comprehensive search and hence, you must do it rightly. You may also take the help of the expert for trademark search.
   

• Other guidelines: Apart from the above two check, the next thing you should do is to go through the following check for company name search:

• The company name should not be too general like Royal Private Limited, India Private Limited.
   
• Do not use any reserved word like Ashoka, emblem, President, Prime Minister.
   
• Kindly follow complete name structure for approval like Brand (Suffix) + Technologies (Activity of your business) + Private Limited.

To have complete understanding of name rules, you must read rule 8 of the company.

3. File company name using RUN application

Once you have thoroughly selected your company name, the next step is to file the company name using RUN service on mca portal. It will cost you Rs.1000 and may take 1 to 2 days for approval.

Important fact: If the name is rejected by the government, then you will have to reapply with a different name and extra fees of Rs.1000/-. Hence, file the name wisely.

4. Prepare for Company incorporation

Once your name has been finalized by the government of India, the next step is to prepare for company registration. This is the final and the most important step for company incorporation. Under this step, all the documents are prepared and are submitted to the registrar of companies. Under this step, SPICE form is prepared and filed. Here are few things for which you must take care:

• Memorandum of Association (MOA): MOA is the document which contains the proposed objective of the company. Whatever your company will do must be drafted in the MOA of the company. Always remember, a company cannot do anything which is not listed in the MOA of the company.
   

• Articles of Association (AOA): AOA is said to be the bye-laws of the company which contains all the important features of the company. It contains the rules which are required to run and direct the company properly. Draft the articles well if you want to have your own rules for the company.
   
• Paid up capital: Paid up capital is the amount of capital which is required to be invested in the company. Make sure you fill it properly because you have to put in the bank account once the company is formed.

5. Submit the application and follow up

Once the application is prepared, the next step you follow is to submit the application using digital signatures. After filing the form, ROC may raise certain queries and if queries are to be answered before a specific date. Make sure you follow up correctly to avoid rejection.

6. Company registration over

If ROC founds everything in place, then ROC will issue the registration certificate. Once Certificate of Incorporation (COI) is issued, your company is formed and hence, you can start your business. Further, PAN and TAN also allotted at the same time. Hence, you need to apply it separately.

Another important point after Company incorporation

Since your company has been incorporated, there are many important things that you must know in order to start the business properly. We have summarized the points for you in order to make you understand it in a better way. Here are the important points:

• Opening Company’s bank account: The next step after company registration is to open the bank account of the company. A bank account can be opened with any bank of your choice and you will require the following documents for the same:
  • Certificate of incorporation (COI)
  • Memorandum of Association (MOA)
  • Articles of Association (AOA)
  • PAN Card
  • Director’s ID proof
  • Director’s Signature
     

• Auditor appointment: Every company in India is required to appoint the auditor within 30 days of incorporation. Initially, the director appoints the auditor. The auditor is a practicing Chartered Accountant who charges fees for the services offered.
   

• Infusing fund into the company: All the initial promoters of the company will have to infuse funds into the company. This is also called an initial capital amount and has to be deposited into the bank account of the company within 2 months of the incorporation. Further, this amount can be used for your business functioning.

Conclusion

Just get on with the company registration and rule the world. For more information, please email us at info@hubco.in.