Private Limited Companies are those types of companies where minimum number of members is two and maximum number is two hundred. A private limited company has the limited liability of members but at the same time it has many characteristics as those of a partnership firm. A private limited company has all the advantages of partnership namely flexibility, greater capital combination of different and diversified abilities, etc., and at the same time it has advantages of limited liability, greater stability and legal entity. In this sense, a private limited company stands between partnership and widely owned public company. Identifying marks of a private limited company are name, number of members, shares, formation, management, directors and meetings, etc., The maximum number of directors shall have to be mentioned in the Articles of Association. In the grand of privileges and exemptions, the Companies Act has drawn a distinction between an independent private company and other private company which is a subsidiary to the other public company.
Steps involved for setup:
- Obtain Digital Signature Certificate DSC for proposed Directors of the Company
- Filing the proposed name of company for approval to the Registrar of Companies (ROC)
- Get the Memorandum of Asociation and Articles of Association printed
Pay stamp duties online - File all incorporation forms and documents online, including the Memorandum of Association and the Articles of Association.
- Obtain the certificate of incorporation
- Request and obtain Certificate to Commence Operation, if required
Obtain a company seal - Obtain a Permanent Account Number (PAN) from an authorized franchise or agent appointed by National Securities Depository Services
- imited (NSDL) or Unit Trust of India (UTI)
Obtain a Tax Account Number (TAN) for income taxes deducted at source from the Assessing Office in the Income Tax Department - Register under Shops and Establishment Act
- Register for value added tax (VAT) before the Sales Tax Officer of the ward in which the company is located
- Register for Profession tax
- Register with Employees’ Provident Fund Organization
- Register with ESIC (medical insurance)
- Filing for Government Approval before RBI/FIPB for Foreigners and NRI’s