{"id":2153,"date":"2022-05-03T06:36:52","date_gmt":"2022-05-03T12:06:52","guid":{"rendered":"https:\/\/smjadvisors.com\/?p=2153"},"modified":"2022-05-17T06:25:13","modified_gmt":"2022-05-17T11:55:13","slug":"private-limited-company","status":"publish","type":"post","link":"https:\/\/smjadvisors.com\/private-limited-company\/","title":{"rendered":"Private Limited Company"},"content":{"rendered":"\n<p>A <strong>Private Limited Company<\/strong> is held by private stakeholders. A Private Limited Company is registered for pre-defined objects possessed by a group of people called shareholders. The liability positioning for this situation is that of a limited partnership, wherein the liability of a shareholder stretches out simply up to the number of shares held by them. <strong>The business entity gets recognized as a Company when it comes into existence after its registration under the Companies Act of 2013 in India.<\/strong><\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p>The governing body is the Ministry of Corporate Affairs, well known as MCA. The meaning of Private Company under the Act is given here to get its essentials. <strong>Section 2 (68) of the Act characterizes a Private Company as under:<\/strong><\/p><cite>\u201cA Company having a minimum paid-up share capital as may be prescribed, and which by its articles,\u2014&nbsp;<br>(i) restricts the right to transfer its shares;&nbsp;<br>(ii) except in the case of One Person Company, limits the number of its members to two hundred;&nbsp;<br>(iii) prohibits any invitation to the public to subscribe for any securities of the company.\u201d<br><\/cite><\/blockquote>\n\n\n\n<figure class=\"wp-block-image size-large is-resized is-style-rounded\"><img fetchpriority=\"high\" decoding=\"async\" src=\"https:\/\/smjadvisors.com\/wp-content\/uploads\/2022\/05\/group-diverse-people-having-business-meeting-1024x561.jpg\" alt=\"\" class=\"wp-image-2156\" width=\"512\" height=\"281\" srcset=\"https:\/\/smjadvisors.com\/wp-content\/uploads\/2022\/05\/group-diverse-people-having-business-meeting-1024x561.jpg 1024w, https:\/\/smjadvisors.com\/wp-content\/uploads\/2022\/05\/group-diverse-people-having-business-meeting-300x164.jpg 300w, https:\/\/smjadvisors.com\/wp-content\/uploads\/2022\/05\/group-diverse-people-having-business-meeting-768x421.jpg 768w, https:\/\/smjadvisors.com\/wp-content\/uploads\/2022\/05\/group-diverse-people-having-business-meeting-1536x841.jpg 1536w, https:\/\/smjadvisors.com\/wp-content\/uploads\/2022\/05\/group-diverse-people-having-business-meeting-2048x1122.jpg 2048w, https:\/\/smjadvisors.com\/wp-content\/uploads\/2022\/05\/group-diverse-people-having-business-meeting-1x1.jpg 1w, https:\/\/smjadvisors.com\/wp-content\/uploads\/2022\/05\/group-diverse-people-having-business-meeting-10x5.jpg 10w\" sizes=\"(max-width: 512px) 100vw, 512px\" \/><\/figure>\n\n\n\n<h2 class=\"has-text-align-left wp-block-heading\"><strong>Features of Private Limited Company<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Members<\/strong> &#8211; <\/li><\/ul>\n\n\n\n<p>A minimum of 2 and a maximum number of 200 members are required to start a private limited company according to the Companies Act, 2013.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Limited Liability <\/strong>&#8211; <\/li><\/ul>\n\n\n\n<p>The liability of every member of a company is limited. It means when a company suffers any kind of loss, in that circumstances shareholders should sell their assets to bear that loss.&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Perpetual succession<\/strong> &#8211;<\/li><\/ul>\n\n\n\n<p>The organization continues to exist according to regulation even on account of death, indebtedness, and the liquidation of any of its members. This prompts the Perpetual succession of the company.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Indexing of Members<\/strong> &#8211; <\/li><\/ul>\n\n\n\n<p>There is no need of indexing the members in a private company whereas, a public company should maintain this. It is a privilege given to private companies over public companies.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Directors <\/strong>&#8211; <\/li><\/ul>\n\n\n\n<p>With only the existence of 2 directors, a private company can come into operations.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Paid-up capital<\/strong> &#8211; <\/li><\/ul>\n\n\n\n<p>Minimum Paid-up Capital should be 1 lakh and higher as per the requirements.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Prospectus <\/strong>&#8211; <\/li><\/ul>\n\n\n\n<p>A prospectus is a statement of a company&#8217;s affair that gets issued in public. In a Private Company, there is no need for it because the public is not invited to be the subscriber of the shares of the company.&nbsp;&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Minimum subscription<\/strong> &#8211; <\/li><\/ul>\n\n\n\n<p>It is the amount received by the organization which is 90% of the shares issued within a specific timeframe. If the company didn&#8217;t receive 90% of the amount then it cannot commence further business.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Name<\/strong> &#8211; <\/li><\/ul>\n\n\n\n<p>All privately owned businesses must use the word private limited after their name.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Advantages of Private Limited Company<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Ownership<\/strong> &#8211; In a public company, shares ownership can be sold in the open market. In the case of a private company, shares can be transferred and sold at the owner&#8217;s choice.&nbsp;<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Legal Formality<\/strong> &#8211; Compared to Public Limited Companies there is a less number of formalities required in Private Limited Company.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Management and Decision-Making <\/strong>&#8211; In a private company, this complex procedure is eliminated because of the less number of shareholders.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Requirements for the registration of a Private Company<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Members &#8211; <\/strong>Minimum number of shareholders or members is 2 and the maximum is 200 as per the companies act 2013.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Directors &#8211;<\/strong> A minimum of two directors is required for the registration of a private company.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Name &#8211; <\/strong>A company&#8217;s name consists of three parts, namely the name, the activity, and the private limited company. All private companies must include the phrase private limited company at the end of their company names.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Registered Office Address <\/strong>&#8211; As long as the company is not registered, the owner should provide a temporary address. Once a company is registered, the permanent address of its registered office will be determined by its registrar.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Digital Signature <\/strong>&#8211; It is used to verify the authenticity of the documents. Each director obtains a digital signature that appears on every document they sign.<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Professional Certification<\/strong> &#8211; Professionals like company secretaries, chartered accountants, cost accountants, etc. should make their certifications when companies are incorporated.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Documents required for a Private Limited Company are:<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\"><li>Identification Proof &#8211; PAN card and passport of Indian directors and foreign directors.<\/li><li>Address Evidence &#8211; Ration card or Aadhar card or driving license or voter ID<\/li><li>Residential Proof &#8211;&nbsp; Bank statement or Electricity bill of place<\/li><li>Notarized rental agreement<\/li><li>NOC from the landowner<\/li><li>A copy of the sale deed or property deed (for an owned property)<\/li><li>Passport size photographs of all the directors of a company<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>How to register a Private Limited Company In India<\/strong>:<\/h3>\n\n\n\n<p><strong>The basic process for enlisting a Private Limited Company in India is as per the following:<\/strong><\/p>\n\n\n\n<ol class=\"wp-block-list\"><li>Get Digital Signature Certificate (DSC)<\/li><\/ol>\n\n\n\n<ol class=\"wp-block-list\" start=\"2\"><li>Self-Attest the Documents for Private Limited Company Registration including AoA, MoA and service bills.<\/li><\/ol>\n\n\n\n<ol class=\"wp-block-list\" start=\"3\"><li>&nbsp;Fill up the form INC-32, this form has been framed for smoothing out many processes including getting DIN, Name Reservation, Incorporation, PAN application, and TAN number.<\/li><\/ol>\n\n\n\n<p><strong>Forms required for the registration of Private Limited Company<\/strong><\/p>\n\n\n\n<p><strong>Ministry of Corporate Affairs (MCA) has introduced :<\/strong><\/p>\n\n\n\n<ol class=\"wp-block-list\"><li>New SPICe INC- 32 Forms for faster company incorporation.<\/li><li>Also, an e-MoA (INC-33) and an e-AoA (INC-34) must be filed.<\/li><\/ol>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A Private Limited Company is held by private stakeholders. A Private Limited Company is registered for pre-defined objects possessed by a group of people called shareholders. The liability positioning for this situation is that of a limited partnership, wherein the liability of a shareholder stretches out simply up to the number of shares held by &hellip;<\/p>\n<p class=\"read-more\"> <a class=\"\" href=\"https:\/\/smjadvisors.com\/private-limited-company\/\"> <span class=\"screen-reader-text\">Private Limited Company<\/span> Read More &raquo;<\/a><\/p>\n","protected":false},"author":2,"featured_media":2156,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","footnotes":""},"categories":[29],"tags":[46,49,48,50,47],"class_list":["post-2153","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-start-business","tag-private-limited-company","tag-private-limited-company-documents","tag-private-limited-company-in-india","tag-private-limited-company-minimum-members","tag-private-limited-company-registration"],"_links":{"self":[{"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/posts\/2153"}],"collection":[{"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/comments?post=2153"}],"version-history":[{"count":4,"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/posts\/2153\/revisions"}],"predecessor-version":[{"id":2205,"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/posts\/2153\/revisions\/2205"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/media\/2156"}],"wp:attachment":[{"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/media?parent=2153"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/categories?post=2153"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/smjadvisors.com\/wp-json\/wp\/v2\/tags?post=2153"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}