Private Limited Company Registration in India
A Private Limited Company is one of the popular options to start a business amongst startups and emerging businesses. It is a corporate entity that is easy to register, manage and run. Private Limited Company Registration can induct up to 200 shareholders wherein the liability of each member is limited.
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Private Limited Company Registration in India
Private Limited Company is considered one of the most popular legal structure amongst the small, medium, and large businesses in India due to its various advantages. It can be chosen by anyone looking to build a scalable business. A Private limited company registration requires a minimum of two members and a maximum of two hundred members.
A Private Limited Company is a type of privately held small business entity, in which owner’s liability is limited to their shares, the firm is restricted to having 200 or fewer shareholders, and shares are prohibited from being publicly traded. Private Limited Company registration in India is governed by the Ministry of Corporate Affairs (MCA), Companies Act 2013, and Companies Incorporation Rules, 2014
A shareholder of a private limited company has limited liability towards creditors, it is restricted only up to unpaid amount of shares. In case of a default, banks/creditors can sell only the company’s assets but not the personal assets of directors and shareholder. Start-ups and growing businesses choose Private Limited Company registration in India because it allows outside funding to be raised easily, limits the liabilities of its shareholders, and enables them to offer employee stock options to attract top talent. As these entities must hold board meetings and file annual returns with the Ministry of Corporate Affairs (MCA), they tend also to be viewed with more credibility than a Sole Proprietorship or General Partnership.
Features of Private Limited Company Registration in India
In order to start a Private Limited Company, minimum of 2 member/shareholder are required. An individual person above 18 years of age or a body corporate can be a member or shareholder in a Private Limited Company. The maximum count of member/shareholder in a Private Limited Company can go upto 200.
A Private Limited Company needs to have a minimum of 2 directors who shall manage the conduct and affairs of the company. The directors may be existing shareholders of the company or can be a person other than a shareholder. There may be a maximum of 15 directors in any company. Every Indian Company has to ensure that they have 1 director who is a permanent resident of India.
- Restriction on Transfer of Shares
The members/shareholders of private limited companies cannot transfer their shares publicly. There can be a restriction on the transferability of shares in these companies.
- Foreign Direct Investment (FDI)
A foreign citizen, foreign corporate entities, NRIs or OCI’s are allowed to be the Directors and/or Shareholders of a Company with Foreign Direct Investment, which makes Private Limited Company as a preferred choice of entity for foreign promoters.
- Prohibition on Inviting Investments from Public
A Private Limited Company is not allowed to invite shareholders publicly to purchase or subscribe to its shares or any other kind of securities. It is also not allowed to accept deposits from the public other than its members, directors, or relative of directors.
Advantages Of Private Limited Company Registration in India
Minimum Requirements For Private Limited Company Registration in India
What Is Included In Our Private Limited Company Registration package?
Private Limited Company Registration Procedure
Documents Required for Private Limited Company Registration in India
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