A Private Limited company is a privately held legal entity owned and operated by a few people.
Features
- Member’s or shareholder’s liability is limited to the number of shares held by them, even in the case of business loss. The individual and the personal assets of the shareholders are not at risk.
- A minimum of 2 shareholders and 2 directors while a maximum number of members can be 200.
- The name of a Private limited company must end with “Private Limited”, abbreviated as Pvt. Ltd.
- It is a separate legal entity. Such a company continues to exist legally in the advent of the death of one or all members, bankruptcy, or the company becoming insolvent.
- Shares of such a company cannot be listed on the stock exchange, but they can be transferred with shareholders’ consent.
- Previously, minimum paid-up capital of Rs. 1 lakh was required for incorporation of Private Limited Company however The Companies (Amendment) Act of 2015, has repealed the provision and therefore there is no minimum capital requirements now for Private Limited Company
Benefits
- It can raise funds effortlessly because it can have up to 200 members and another 200 shareholders, therefore having a greater scope for expansion as it can easily take loans and debts from banks or financial institutions.
- None of the members or directors is liable to repay the debts or loans if the company fails to pay.
- A corporation can have a legitimate and adequate contract with any of its members under the umbrella of a Private limited company.
- The share transfer procedure is more uncomplicated than in other business entities.
- They are endowed with several exemptions under the Companies Act if they engage in social work.
- They are advantageous for investment in long-term strategies, keeping discrete share value, autonomy and flexibility of operations.
Requirements for forming a Private Limited Company
- A minimum of 2 and a maximum of 200 members are required to start a Pvt. Ltd.
- Each director should have a Director Identification Number (DIN) allocated by the Ministry of Corporate Affairs.
- One of the directors should be a resident of India and should have stayed in India for at least 182 days in the previous year.
- No two Pvt. Ltd. companies can have a resemblance in the name. A company needs to send at least 2-3 names (with Pvt. Ltd. as a suffix) for approval to the Registrar of Company(ROC).
- Application for Commencement of business must be filed with the ROC once the company is registered and amount of share capital is received from the shareholders.
- Directors and Promoters Shareholders of the Company must obtain a digital signature certificate required for the authenticity of documents during their electronic submission.
- Certification by Professionals (like Chartered Accountants, Company Secretaries, Cost Accountants, etc.) is necessary for the company for varied activities.
Other documents:-
- Documents relating to Identity proofs like the PAN card of an Indian and the passport of a foreign director.
- Address proofs like driving license, voter IDs, Passport or Aadhar card.
- Proof of residence like bank statement or electricity bill of the premise.
- Notarized rental agreement and NOC from the property owner.
- A copy of the sale deed or property deed or Index II is mandatory for the self-possessed property.
Azalea Advisors provides you with one-stop solutions for all kinds of requirements for starting a business. We provide you with the assistance of an experienced team of Chartered Accountants and Company Secretaries having substantial knowledge of various industries and businesses around the globe. We have also helped foreign Companies in setting up the business by incorporating their subsidiaries in India and fulfilling mandatory FEMA Compliances. For starting a new business and ensuring efficient services, Azalea Advisors is undoubtedly an excellent choice for Private Limited Company Registration Services in Pune.
