Importants to Keep While Business Registration in India

• Business registration in India is pivotal for establishing a distinct legal identity separate from personal affairs, often as a “private limited company” or “limited liability partnership.” This shields personal assets in cases of business failures or legal disputes. Moreover, registered businesses garner credibility, fostering trust among customers, suppliers, and potential investors, bolstering brand reputation and fostering collaboration opportunities.  

• Additionally, registration unlocks access to government schemes, financial aid, and tax benefits, catalysing growth. According to recent data from the Ministry of Corporate Affairs, September 2021 saw a significant uptick, with 16,570 new companies registering in India, marking a remarkable ~24% increase from the preceding month. Tetra Consultants streamline the process to register company in India, ensuring compliance and facilitating seamless establishment. 

Types of entities for business registration in India 

Public limited company 

• Public Limited companies are entities registered and incorporated independently under the Companies Act, 2013. Owned by a group of shareholders, their liabilities are limited to their stakes in the company. Shares of public limited companies are easily transferrable and tradeable in stock exchange markets, open for subscription by the general public. Below are the prerequisites for establishing a Public Limited Company in India. 

• Various statutory requirements for business registration in India includes: 

• Minimum 7 shareholders 

• Minimum 3 Directors, at least one must be resident Indian  

• An ROC approved name for the company  

• DIN of all directors  

• DSC of all promoters 

• Registered office of the company 

Private limited company 

• Private Limited Companies are entities registered under the Companies Act of 2013. Unlike public limited companies, their shares are traded privately and are not listed on stock exchange markets. Additionally, shares cannot be subscribed by the general public. Shareholder liability in Private Limited Companies is limited to their unpaid subscribed capital only. 

• Various statutory requirements are as follows: 

• Minimum 2 shareholders 

• Minimum 2 Directors, at least one must be Indian Resident Indian 

• An ROC approved name for the company  

• DIN of all directors  

• DSC of all promoters 

• Registered office of the company 

One person company 

• An One Person Company (OPC) is a type of single-owner Private Limited Company established under the Companies Act, 2013. With a sole shareholder holding 100% ownership and profit share, OPCs offer limited liability, where the shareholder’s responsibility is confined to the unpaid subscribed capital. 

• Various statutory requirements are as follows: 

• One Shareholder who is an Indian Citizen 

• At least One Director who is a Resident Indian  

• An ROC approved name for the company  

• A Registered Office for the company  

• DIN & DSC of all directors 

Section 8 company 

• Section 8 of the Companies Act, 2013 outlines provisions for establishing limited companies as non-profit organizations, either owned by individuals or associations of people. These companies are dedicated to advancing various societal causes such as arts, commerce, education, sports, research, and environmental conservation. All income, donations, and grants received by a Section 8 Company must be utilized for promoting these objectives. Operating as separate legal entities, such companies offer donors tax benefits under Sections 12A and 80G of the Income Tax Act. 

Limited liability partnership 

• The Limited Liability Partnership (LLP) Act of 2008 introduced LLPs to address shortcomings of traditional Partnership Firms. Registered as separate legal entities, LLPs operate with independent identities. Partners benefit from limited or restricted liability based on their capital contributions. Similar to traditional partnerships, LLP partners agree upon terms and conditions before commencing operations. These are formalized in a written agreement, signed by partners and notarized by a public notary. 

• Various statutory requirements are as follows: 

• Minimum 2 Partners  

• Minimum 2 Designated Partners, at least one must be Resident Indian  

• An ROC Approved Name for the LLP  

• A Registered Office  

• DPIN of all Designated Partners  

• DSC of all Partners   

Partnership firm 

• Partnership firms, comprising two to twenty individuals, distribute income or profits based on a predetermined profit-sharing ratio. While registration under the Partnership Act 1932 is optional, firms can commence operations upon drafting and signing a partnership deed, duly approved/stamped by a notary.  

• However, acquiring Certificates of Registration or Incorporation is advisable, as it facilitates legal standing in court and enables firms to file cases against third parties if necessary. Registered firms can issue valid invoices, obtain tax registrations, claim tax deductions, file tax returns, and bolster credibility with customers, employees, and investors. 

Sole proprietorship 

• Sole proprietorships, owned and managed by a single individual, lack separate legal identities and operate under the proprietor’s name. The proprietor retains full ownership and profits but bears unlimited liability, risking personal assets to settle business debts. With the proprietor’s lifespan, the business’s existence ceases. Taxation occurs on the proprietor’s personal income, with no entity-level tax up to Rs. 2 lakhs and limited benefits beyond Rs. 10 lakhs. Indian citizens and NRIs can establish proprietorships with no minimum capital requirement. 

Steps for business registration in India 

Step 1: Obtain Digital Signature Certificate (DSC) 

• Begin by acquiring a Digital Signature Certificate (DSC), essential for online transactions and document filings, serving as electronic identification. Tetra Consultants offer a comprehensive service package, facilitating the procurement of DSCs alongside offshore company incorporation and various other services. Accredited agencies provide the DSC, ensuring seamless compliance with regulatory requirements. 

Step 2: Obtain Director Identification Number (DIN) 

• Next, Tetra Consultants will facilitate the application process for Director Identification Number (DIN) for all directors of your company. This mandatory unique identification number is obtained by submitting an online application through the Ministry of Corporate Affairs (MCA) portal. 

Step 3: Reservation of company name 

• Further, Tetra Consultants will assist in selecting a unique name for your business and submit it for approval to the MCA. We ensure compliance with naming guidelines and verify no infringement on existing trademarks. Additionally, we provide name reservation services and offer international trademark registration services to safeguard your brand globally. 

Step 4: Prepare the incorporation documents 

•  Furthermore, Tetra Consultants will assist in gathering essential documents, such as identity proof, address proof, and director photographs, along with the registered office’s address proof. Additionally, we offer legal drafting services to help draft the Memorandum of Association (MOA) and Articles of Association (AOA), detailing the company’s objectives, rules, and regulations, ensuring compliance with various document requirements. 

Step 5: File incorporation documents 

• Once all the documents are prepared, Tetra Consultants will assist in filing them with the appropriate Registrar of Companies (ROC) along with the requisite fees. This marks the completion of the registration process. Upon successful verification, you will receive a Certificate of Incorporation. 

Step 6: Apply for PAN and TAN 

• After securing the Certificate of Incorporation, Tetra Consultants will assist in applying for a Permanent Account Number (PAN) from the Income Tax Department. This crucial identifier is necessary for tax-related transactions. Additionally, we will facilitate the registration for Goods and Services Tax (GST) if your business turnover surpasses the specified threshold. With our assistance, obtaining TAN and PAN will be seamless and efficient for our clients. 

Step 7: Open a business account 

• Once you have obtained TAN, PAN and incorporation certificate our experts will proceed for corporate bank account opening for our clients. We will provide them an operational bank account in 4 weeks of incorporation. 

Conclusion 

• Tetra Consultants streamlines the business registration in India, offering comprehensive support from document preparation to obtaining necessary permits. With our expertise, clients navigate regulatory requirements seamlessly, ensuring legal compliance and facilitating successful incorporation for their ventures. 

• Contact us to know more about business registration in India and our team will revert back in 24 hours.