Company Registrationplays an important as it creates a corporate image and provides more credibility and commitment. The shareholders and banks are assured a sense of security which makes it easier to get funds. Moreover, after registration, the company becomes a legal entity and thus it attracts the investment from outside.
What is a private limited company?
A private limited company is one which can be very closely associated to a corporation. The liability of the members here is limited. Being a private company, it cannot attract investment from outside. Thus the entire capital is contributed by the members of the company.
Advantages of a private limited company:
Limited liability: The liability of the members is limited and they cannot be called upon to pay the dues of the company. Even if the company becomes insolvent, they have no further liability than the fully-paid up shares of the company held by them.
Name protection: The Registrar of Company should not allow other businesses to use the company’s name or a name which nearly resembles it. This protects the company from other companies that might use its name for fraudulent purposes.
No minimum paid up capital: There is no limit on the minimum paid up capital.
Steps for registration of a private limited company:
The private limited company registration necessitates few steps. They are:
Documents check: A scanned copy of some documents like latest bank utility statements, passport, and pan card is required.
Application for Digital Signature: The digital signature is a mandate for the registration of the company. The signatures shall be used for tax filling purposes. The directors have to submit their digital signatures to the Registrar of Company.
Application for Director’s Identification Number: An application is to be filled with the Registrar of Company for Director’s Identification Number. It is a unique number assigned. One cannot become a director without getting DIN from the Registrar.
Application for Name Reserve: One has to file an application with the Registrar for name reserve. This means that the particular name filed for shall be used exclusively for the company. The Registrar will not allot any name which is similar or identical to the name applied by the company to any other business.
Incorporation: After the name is accepted the company shall become a legal entity. Thus the pvt ltd company registration is complete.