India is getting ready to welcome the changes in global business. Earlier, it was a Herculean task to register a new company in India.
Now the government has made the registration process easier in order to encourage startups and entrepreneurs.
However. the red tape and paperwork might confuse you if you do not have a clear picture. You might still feel like a toddler lost in the woods!
But don’t worry Entrepreneurs of India are here to help as your guiding spirit.
Where to go?
For registering a company in India you have to approach the Ministry for Corporate Affairs. The ministry is concerned with administration of laws governing company registration in India. Find more about company laws here.
We provide you with step-by-step information on how to register your company in India.
Create an account with the Ministry of Corporate Affairs Portal
The first thing you have to do is visit the portal of Ministry of Corporate Affairs, follow the instructions and create an account.
All the further processes of your company formation would be done through this user account.
2. Obtain Digital Signature Certificate
As per IT Act, all electronic documents should possess a digital signature certificate in order to ensure authenticity. So, the application has to be digitally signed by the applicant.
Click here for acquiring digital signature.
3. Obtain Director Identification Number
DIN is a unique identification number issued by the government to the director of the proposed company. It’s mandatory to run your company. It helps keep a database on directors of the registered companies.
How to get DIN?
Submit an application using eForm DIR-3 to ministry of corporate affairs and fill the credentials as per instructions. Any correction in DIN can be made freely through the website of the ministry.
Download the eForm DIR-3 here.
Fee of eForm DIR-3 should be remitted via credit card or net banking. Offline payments are not accepted.
The fee depends upon the nature of your company and the number of directors.
DIN will be generated once the payment is completed successfully. Once the DIN is received, you can communicate it with the stakeholders of the proposed company.
Documents required for DIN : Company PAN Card, photograph, scanned copies of proof of identity, date of birth and residence are mandatory to acquire DIN. If you’re a foreign citizen, then a copy of your passport must be attached with the application.
4. Incorporation of the company
Once you get the DIN, you have to provide details of the proposed company. This includes giving a list of names, the location, address and nature of the company.
How to name your company ?
To name your company, you have to submit an application in the prescribed Form 1 A format to Registrar of Companies (ROC).
You have to provide at least four alternative names for your proposed company in preferential order. This is done to make sure that your company gets a unique name.
In case all the names that you suggested are already taken by other registered companies, ROC will come up with some choices that would suit your interest.
5. Drafting MOA & AOA
MOA and AOA are the two fundamental documents required to run your business. Your company would be invalid without them. MOA and AOA must be drafted when you incorporate your company.
What are MOA & AOA?
MOA stands for Memorandum of Association. It’s a document that contains all the basic information of the company.
It acts as the root document of your company. It includes details like the name, address, objectives, limited liability clause and share capital of the proposed company. There are strict rules to draft MOA.
AOA is the abbreviated form of Association of Articles. It contains all the laws governing the company.
It outlines the ways in which shares are distributed, rules to be followed by the stakeholders, responsibilities of the individuals to the company etc. AOA is more flexible than MOA and acts as its preamble. The decisions of the company reflect in AOA.
Click here to see a sample of MOA and AOA draft.
How to draft MOA and AOA?
Since both of them are crucial, legally valid documents, you can seek the help of lawyers or other professional groups to draft MOA and AOA.
Usually you would have to discuss the way your proposed company works and other similar aspects with the experts to draft them.
Need help with MOA and AOA? Click here to ask an expert.
Certificate of incorporation will be issued once you successfully complete these procedures.
How long will it take?
Usually, it takes about 5 to 15 working days to register a company in India if you have every document with you including a valid digital signature certificate and a company PAN card.
Finally,you can recline on your easy chair and relish a coffee if you manage to finish the registration on time. But from the next day you would have to burn candles at both ends to grab your clients! We wish you goodluck.