INDIA: An Attractive Destination For Businesses
Indian economy is one among the fastest-growing economies within the world with GDP growth of around 7 – 8% and a population of over 1 billion as per International Bank for Reconstruction and Development Data (2016). The statistics show that India as of now boasts of a profitable and stable economy and has already entered the league of emerging markets thus making it a beautiful option for foreign investors.
The common sorts of fixing a business in India are:
- Private Ltd. (PLC),
- Public Ltd. (PC),
- Limited Liability Partnership (LLP).
From a far off company’s point of view, a personal Ltd. (PLC) is one among the highly recommended ways to start out a business in India. PLC offers indebtedness for its shareholders with certain restrictions placed on the ownership. An LLP has partners, who own and manage the business. Whereas during a PLC and PC, directors could also be different from shareholders.
Brief Steps for the formation of a corporation
- First and therefore the foremost step for fixing a corporation in India is filing an application for reservation of a singular name for the proposed company. The applicant has an choice to provide two (2) name choices within the web application. The proposed names can either be accepted or rejected supported the scrutiny by the Registrar, Central Registration Centre (CRC). just in case the applied names aren’t available and approved by the department, then further two more names are often provided and thereafter applied for. An approved name is valid for a period of 20 days from the date of approval.
- The next step is obtaining a digital signature certificate (DSC for proposed directors and shareholders) and Director Identification Numbers (DIN) for proposed directors. As per the applicable law, for incorporating a PLC, a minimum of two directors is required and one among them must be a director resident in India. Also, it’s mandatory for all proposed directors to carry a legitimate DIN.
- Once the name is approved, the drafting of company incorporation documents like declarations by directors and shareholders, memorandum and articles of associations (MOA and AOA) and documents concerning registered office addresses of the corporate and filing it on the online portal of MCA registry are going to be done.
- The PAN and TAN also are applied simultaneously to the corporate Incorporation.
- As per the recent amendments, a web-based filing, i.e. SPICe+ shall be undertaken for the incorporation of a corporation and shall be amid the e-form AGILE-PRO for mandatory application for the subsequent additional registrations for the company:
- Goods and repair Tax number (GSTIN)
- Employees’ Provident Fund Organization (EPFO) registration
- Employee State Insurance Corporation (ESIC)
- Profession Tax Registration
- Opening of checking account
- Once the appliance is approved by the CRC, a Certificate of Incorporation is issued to the corporate as a symbol of registration of the corporate with the MCA.
- Additionally, a corporation with share capital, shall not commence any business or exercise any borrowing powers unless it receives the certificate of commencement of business from the Registrar of Companies (ROC).
The next step is obtaining a digital signature certificate (DSC for proposed directors and shareholders) and Director Identification Numbers (DIN) for proposed directors. As per the applicable law, for incorporating a PLC, a minimum of two directors is required and one among them must be a director resident in India. Also, it’s mandatory for all proposed directors to carry a legitimate DIN.
Once the name is approved, the drafting of company incorporation documents like declarations by directors and shareholders, memorandum and articles of associations (MOA and AOA) and documents concerning registered office addresses of the corporate and filing it on the online portal of MCA registry are going to be done.