Procedure for Incorporation of a company limited by shares
Step I
Obtain DIN (Director Identification Number)
If the propective directors already have DINs then you may go ahead with the next step of ascertainig availability of name and if the directors do not have DINs then the first step is to generate DINs of the prospective directors. Click here to know how to generate a DIN.
Step II
Ascertaining Availability of name.
The next step is choosing a name of the company, the name should be unique and should not be similar or closely resemble to any existing company. You may check the name from the official website of Ministry of Corporate Affairs before making an application. If your chosen name does not match with any existing company, ensure following points before making a formal application.
1. The name should reflect the main business of the company. For example if your company is going to do business in the field of information technology then the name should contain the words like IT, Infotech, Software, Technology, etc.
2. There should be a prefix to the word describing activity of the company. The name Software services Pvt Ltd can not be given there should be a prefix to it to make it unique. For example the name may be S P Software Services Pvt Ltd wherein S P may be initials of the promoters of the company or words like Advanced, Grand, Zigma, etc. may beused as prefix to the name of the company, provided that the name does not become identical or similar to the nameof any existing company or any other approved name.
3. Use of certain words in the name of the company require to fulfill minimum authorised capital condition asdetailed hereunder.
A minumum of Rs. 5 crores Authorised capital is required to use the word “Corporation” in the name of the company.
A minumum of Rs. 1 crore Authorised capital is required to use the words “International”, “Globe”, “Universal”, “Continental”, “Inter-Continental”, “Asiatic” or “Asia” as the first word in the name of the company.
A minumum of Rs. 50 lacs Authorised capital is required to use the words “International”, “Globe”, “Universal”, “Continental”, “Inter-Continental”, “Asiatic” or “Asia” within the name of the company.
A minumum of Rs. 50 lacs Authorised capital is required to use the words “Hindustan”, “India” or “Bharat” as the first word in the name of the company.
A minumum of Rs. 5 lacs Authorised capital is required to use the words “Hindustan”, “India” or “Bharat” within the name of the company.
A minumum of Rs. 1 crore Authorised capital is required to use the word “Industries” or “Udyog” in the name of the company.
A minumum of Rs. 10 lacs Authorised capital is required to use the word “Enterprises”, Products”, “Business” or “Manufacturing” in the name of the company.
4. Also, it has to be decided whether the Company will be a private limited company or a public limited company. In case of a private limited company the minimum number of members (shareholders) is 2 and the minimum number of directors is also 2 and the minimum paid up and authorised share capital should be Rs. 1,00,000/- and in case of apublic limited companyNow fill up form no. 1A and upload it at the website of Ministry of Corporate Affairs at http://mca.gov.in and paythe requisite fees of Rs.500/-. The SRN (Service Request Number) for payment of fees will be the approval number after your form is approved.
Step III
Drafting Memorandum and Articles of Association.
After the name of the company has been approved, the next step is to draft the Memorandum and Articles of Association of the Company. The Memorandum of Association contains the name of the company, the State in which the registered office of the company will situate, the objects of the company,the liability of members and the authorised share capital of the company. Thereafter the subscribers will sign the Memorandum of Association writing their names, addresses, descriptions and number of shares subscribed by them. The Articles of Association are the regulations of the company. Click here to see specimen Memorandum of Association and specimen Articles of Association of a private limited company and specimen Articles of Association of a public limited company.
Step IV
The Memorandum and Articles of Association have to be stamped as per the applicable stamp laws of the respective states in which the company is being incorporated.
Step V
The last step for incorporation of the company is filing of forms 1, 18 and 32 together with Memorandum and Articles of Association of the company. Fill them and upload at the website of the Ministry of Corporate Affairs at http://mca.gov.in. Lists of attachments for the abovesaid forms are given hereunder.
Form 1 (Declaration that the requirement of Companies Act, 1956 have been complied with)
1. Memorandum of Association
2. Articles of Associaiton
3. Form 1 (Scanned copy of Form 1 on a stamp paper of Rs. 10/- is to be attached)
4. Power of Attorneys by all subscribers (if a professional is authorised to carry out alterations and corrections in the documents filed for registration of the company)
Form 18 (For intimation of registered office of the company)
No attachments are required to be filed with form 18.
Form 32 (For intimation of appointment of directors)
1. Consent Letters (in case of a public limited company)
The certificate of incorporation will be delivered at the registered office of the company after the SRN of form 1, 18 and 32 is approved.