A Proprietor, willing to expand its business and area of operations may opt to convert its proprietary business to Private Company. A proprietor may opt for such conversion taking into account the synergies associated with such conversion of business to Private limited Company. A Private Limited company is a separate legal entity having perpetual succession, having limited liability with regard to defaults, subject to certain conditions.
Drafting of the agreement for the sale of Proprietory business to the new company.
Checking the name availability of the Company and applying to ROC for obtaining the approval of the name.
Applying for the DIN and digital signatures of the Directors of the Company.
Drafting of the Memorandum and the Articles of association of the Company.
Filing/ E-filing of the all the relevant documents with the ROC and obtaining the Certificate of Incorporation of Company.
Non-compliance of these conditions would entail heavy tax liabilities on the Proprietor
– The Director needs to be over 18 years of age and must be a natural person. Foreign nationals can also be directors in an Indian Private Limited Company. However, out of the 2 directors, atleast 1 should be an Indian resident.
– Yes, Company can be given any name provided it should comply with the rules as laid down in the Companies (Incorporation) Rules, 2014.
– Yes. DIN is a unique identification number that is required for all the Directors and DSC is required for the Directors to sign the forms electronically.
– Yes, a Foreign National or an NRI Foreign Companies can hold shares of a Private Limited Company subject to Foreign Direct Investment (FDI) Guidelines.
– No it is not mandatory to have a proper place of business to incorporate a Company. However, you shall need to have a place which shall act as the Registered Address of the Incorporated Company.
– For Domestic Companies: September 30 of each year
– For Companies governed by Transfer Pricing provisions: November 30 of each year.
– The date of issuance of Certificate of Incorporation of the Company shall be the date of incorporation of the Company.
– Yes, as per the provisions of the Companies Act, 2013, all companies shall need to get its accounts audited by the Statutory Auditor, who shall be Chartered Accountant or a Company of Chartered Accountant.
–Before April 1, 2017:
All companies: 30% as increased by surcharge and education cess
After April 1, 2017:
Companies having turnover < Rs. 50 crores: 25% as increased by surcharge and education cess.
Companies having turnover > Rs. 50 crores: 30% as increased by surcharge and education cess.