All you need to know

Private Limited Company in India is one of the popular forms of business entities. Approximately 90% of companies in India are registered under Private Limited Company. There are more than 150,000 companies that are being registered on a yearly basis. It is a separate legal entity with limited liability and perpetual existence incorporated now under the Companies Act, 2013.

A Private Limited Company offers limited liability and legal protection to its shareholders. A Private Limited Company in India lies somewhere between a partnership firm and a widely owned public company. It can be registered with a minimum of two people. A person can be both a director and shareholder in a Private Limited Company.

The liability of the members of a Private Limited Company (PLC) is limited to the number of shares held by them. A Private Limited Company in India can begin with operations after getting the Certificate of Incorporation. A PLC can be incorporated within 15 working days.

How to start / form / make a Private Limited Company?

Steps to be taken to get a new company incorporated:

Selection of a suitable name

MOA & AOA drafting

Application to concerned ROC

Filing of the Forms & Documents

Registration of a Pvt Ltd Company

Hence, Incorporating a Private Limited Company is even easier now .

Documents Required for Private Limited Company registration

Documents required for Private Limited

1) PAN card for each Directors

2) ID Proof – Driving License/ Passport or Voter ID of each Directors

3) Address Proof – Latest Bank Statement OR Telephone/Mobile Bill of each Directors

4) Address Proof of The Company – EB CARD or GAS Bill

5) Passport Size photo of each Directors.

6) email and mobile number of each Director

Benefits of Company Registration

Registering a company offers many benefits. A registered company increases the authenticity of your business. It helps your business:

• Shield from personal liability and protects from other risks and losses
• Attract more customers
• Procure bank credits and good investment from reliable investors with ease
• Offers liability protection to protect your company’s assets
• Greater capital contribution and greater stability
• Increases the potential to grow big and expand

This is a non-Governmental organization which is secretly held for small business. The liability of the individuals from a Private Limited Company is limited to how much share separately held by them. Shares of Private Limited Company can’t be publically exchanged.

Advantages of Private Limited Company

• Limited risk to personal assets in Private Limited Company.
• It is easy to fetch funding in a private limited company by transferring of shares.
• For a private company, the earlier minimum number of the share capital was Rs. 1,00,000, but now there is no such minimum capital compulsion
• The share of the pvt. Ltd company is transferable by a shareholder to any other person.
• Foreign investor can invest their fund directy to the private limited company.
• Registering your business as private limited company will help you to attracting the investor helps to competing the market of your industry.
• Private limited company are not pressurized by the stock market and you don’t have to worry about shareholder.
• The limited company can focus long-term earning without any hesitance.

Disadvantages

• The maximum shareholder is 50, and the maximum member is 200.
• The share of the private limited can’t be quoted in the stock exchange.
• They can’t issue prospectus to public.