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Discussion > Corporate Law > Pvt ltd >

Requirements for a Private Limited Company

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Nagari Sultanpur U.P.Delhi


[ Scorecard : 13298]
Posted On 16 January 2011 at 14:42 Report Abuse

Requirements for a Private Limited Company

  1. A Registered Business Name: This must be followed by the word ‘Limited' or ‘Ltd'. The Companies Registration Office exercises some control over the choice of name, it cannot be identical (or very similar to) the name of an existing company. It won't be considered if it is offensive or illegal and the use of certain words in a company (for example, `Institute', `National') can only be used in certain circumstances. The company name must be displayed in a conspicuous place at every office, or other premises where the company carries out business.

     

  2. A Registered Office: This need not necessarily be the same address as the business is conducted from. Quite frequently the address used for the registered office is that of the firm's solicitor or accountant. This is the address, through, where all official correspondence will go.

     

  3. Shareholders: There must be a minimum of two shareholders (also described as `members' or `subscribers'). A private company can have up to fifty shareholders.

     

  4. Share Capital: The company must be formed with a stated, nominal share capital divided into shares of fixed amounts. Small companies are frequently formed with a nominal share capital of Rs.100.
     

  5. Memorandum of Association: The memorandum is the company's charter. It states the company's name; the situation of its registered office; its share capital; the fact that liability is limited and, most importantly, the object for which the company has been formed. In theory, the company can only operate in the areas mentioned in the objects clause but in practice the clause is drawn to cover as wide an area as possible, and anyway a 75 per cent majority of the members of the company can change the objects whenever they like. Nevertheless, it is worth bearing in mind that directors of the company will incur personal liability if the company engages in a type of business which is not authorized by the objects clause. The memorandum must be signed by at least three shareholders.

     

  6. Articles of Association: The document contains the internal regulations of the company, the relationship of the company to its shareholders and the relationship between the individual shareholders. Many companies don't bother to draw up their own articles but adopt (sometimes with some modifications) articles set out in the Companies Act.

     

  7. Certificate of Incorporation: This is the document, which the registrar of companies issues to you once he has approved your choice of name and your memorandum. When you receive this document your company legally exists and is ready to trade.

     

  8. Auditors: Every company must appoint a qualified auditor. The auditor's duty is to report to the treasurer whether or not the books of the company have been properly kept, and that the balance sheet and profit and loss account presents (or doesn't present) a true and fair view of the company's affairs and complies with the Companies Act. Auditors are appointed or re-appointed at general meetings at which annual accounts are presented, and they hold office from the conclusion of the meeting until the next general meeting.

     

  9. Accounts: The Companies Act lays down strict rules on accounting. Every company must maintain a set of records, which show the financial position at any one time with reasonable accuracy. The accounts comprise a profit and loss account and balance sheet with the auditors' and directors' reports appended. A new company's accounting reference period begins on its incorporation and runs until the following 31st March - unless the company notifies the registrar of companies otherwise. Within ten months of the end of an accounting reference period, an audited set of accounts must be laid before the shareholders at a general meeting and a set delivered to the registrar of companies.

     

  10. Registers, etc.: In addition to the accounts books, companies are required to have: a register of members and share ledger; a register of directors and secretaries; a register of share transfers; a register of charges; a register of debenture holders; a book can be purchased to hold all of the above. This will be provided automatically if you buy a running concern.

     

  11. Company Seal: All companies must have an engraved seal. This must be impressed on share certificates and must be used whenever the company has to execute a deed. Again, this is included in the ready-made company package.



Total thanks : 2 times

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CA SALONI
CHARTERED ACCOUNTANT


[ Scorecard : 391]
Posted On 12 February 2011 at 11:47

thank you





Shivani Mittal
Practice


[ Scorecard : 154]
Posted On 24 May 2012 at 23:35

Thanks alot for your valuable input.

Can u please tell me "What will be the estimated cost (eg: MCA filing fee, statutary payments to ROC etc)

involved for maintaining a private limited company ? "




Swagatam Khandelwal
Company Secretary


[ Scorecard : 102]
Posted On 25 May 2012 at 17:14

Dear Ms. Shivani Mittal the estimated cost will depend upon the authorised capital & activities of the company




CA Abhishek Singh
practice


[ Scorecard : 2018]
Posted On 05 June 2012 at 19:20

in maharashtra. fees will be as under. assumed two directors and authorised capital 100000 and pvt ltd company

din : 200

form 1A : 1000

form 1, 18&32 : 4800

stamp duty: 1300

total :7300

 




Neha Jain
Company Secretary


[ Scorecard : 7337]
Posted On 06 June 2012 at 18:54

Cost of digital signature (approx Rs. 1100/-) and printing of MOA (Approx Rs. 1000/-) is not included. 




Ashvini
student


[ Scorecard : 21]
Posted On 14 August 2012 at 12:53

what is building requirement for software company , and location ,

Please suggest me , I want to open a software compnay so these are big essue for me .

Thank



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