This is a query regarding formation of a Pvt.Ltd. Company with the following objectives :-
Principle Business : Retail Trade Other : Direct investment in securities ( Investment Activities)
1. Is there any specific procedure of incorporation for this type of company under ROC ?
2. Is the company required to get CoR from RBI even if it does not satisfy the 50% criteria for NBFC ?
Kindly provide your valuable inputs to resolve this query. Need it urgently. Thanks !
1. There is no spefic procedure regarding incorporation of Company i.e. General procedure to follow incorporation of company Under the Companies Act 1956
2. Yes mandatory to get the COR if the principal business is Lending and borrowing the amounts
In terms of Section 45-IA of the RBI Act, 1934, it is mandatory that every NBFC should be registered with RBI to commence or carry on any business of non-banking financial institution as defined in clause (a) of Section 45 I of the RBI Act, 1934.
However, to obviate dual regulation, certain categories of NBFCs which are regulated by other regulators are exempted from the requirement of registration with RBI viz. Venture Capital Fund/Merchant Banking companies/Stock broking companies registered with SEBI, Insurance Company holding a valid Certificate of Registration issued by IRDA, Nidhi companies as notified under Section 620A of the Companies Act, 1956, Chit companies as defined in clause (b) of Section 2 of the Chit Funds Act, 1982 or Housing Finance Companies regulated by National Housing Bank.
CAclubindia
