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company formation process in india, New Company Formation , Company Registration, Procedure for Formation of Company in India, Private Ltd Registration, private ltd company registration india

Company Formation in india


Company Registration in delhi india

A Company is an association of both natural and artificial persons incorporated under the existing laws of a country. In terms of the Companies Act, 1956,a company means a company formed and registered under Companies Act, 1956 or under the previous law relating to Companies. In common law, a Company is a “legal Person”  “legal entity” “separate from”, and capable of surviving beyond the lives of its members.

The Companies Act of 1956 sets down rules for the establishment of both public and private companies. The most commonly used corporate form is the limited company, unlimited companies being relatively uncommon. A company is formed by registered the Memorandum and Articles of Association with the State Registrar of Companies of the state in which the main office is to be located.

A Private Company is one, the articles whereof contains the following restrictions:-

  • Restricts the minimum paid up share capital to such an amount as may be prescribed but which shall not be less than rupees one lakh;
  • Restricts the rights of members to transfer its shares, if any;
  • Limits the number of its members to fifty excluding the past or present employees of the company who are members of the company;
  • Prohibits any invitation to the public to subscribe for any shares or debentures of the company;
  • Does not invite or accept any deposits from persons other than its members, directors or their relatives.

Also, the minimum number of members in private company is two and such a company must have the words ‘Pvt Ltd’ as the last part of its name.
A Public Company, as defined in the Companies Act, has the following features:-

  • Its shares are freely transferable;
  • There is no ceiling on its membership;
  • It can invite general public to subscribe to its shares;
  • It has a minimum paid up capital of Rs. 5 lakhs or such higher paid up capital as may be prescribed;
  • It is a private company which is a subsidiary of a public company.

Also, the minimum number of members in a public company is seven and such a company must have the word 'Ltd' as last part of its name.

Foreign companies engaged in manufacturing and trading activities abroad are permitted by Reserve Bank of India to open branch offices in India for the purpose of carrying on the following activities in India:

# To represent the parent company or other foreign companies in various matters in India, for example, acting as buying/selling agents in India, etc.
# To conduct research work in which the parent company is engaged provided the results of the research work are made available to Indian companies
# to undertake export and import trading activities

# to promote possible technical and financial collaboration between Indian companies and overseas companies.
Application for permission to open a branch, a project office or liaison office is made via the Reserve Bank of India by submitting form FNC-5 to the Controller, Foreign Investment and Technology Transfer Section of the Reserve Bank of India. For opening a project or site office, application may be made on Form FNC-10 to the regional offices of the Reserve Bank of India. A foreign investor need not have a local partner, whether or not the foreigner wants to hold full equity of the company. The portion of the equity thus not held by the foreign investor can be offered to the public.

 

 

company formation process in india, New Company Formation , Company Registration, Procedure for Formation of Company in India, Private Ltd Registration, private ltd company registration india.