{"id":96,"date":"2019-06-26T07:15:43","date_gmt":"2019-06-26T07:15:43","guid":{"rendered":"https:\/\/www.smartcorp.in\/blog\/?p=96"},"modified":"2019-07-13T07:10:44","modified_gmt":"2019-07-13T07:10:44","slug":"company-incorporation-india-benefits-registering-company","status":"publish","type":"post","link":"https:\/\/www.smartcorp.in\/blog\/company-incorporation-india-benefits-registering-company\/","title":{"rendered":"Company incorporation in India: Benefits of registering company"},"content":{"rendered":"\n<p>Chiefly, India is a major place where the start-ups and the entrepreneurs are growing rapidly. Company incorporation is not an easier task. Choosing your business is easy, but you have to register your <a href=\"https:\/\/www.smartcorp.in\/tirupur\/company-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">company<\/a> under the right sector. The registered company gains more advantages compared to other companies. Majority of the people desire to incorporate a registered company having separate legal entity in their eyes of laws.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/company-filing.jpg\" alt=\"Company incorporation in India: benefits of registering a company\" class=\"wp-image-106\" width=\"302\" height=\"284\"\/><\/figure><\/div>\n\n\n\n<p>Moreover, company refers to the mode of doing business. Mostly, it depends on what are your expansion plans, future team size, funding requirements and business vision. There are several options like private limited company, public limited, one Person Company and limited liability partnership; the most preferred option will be <a href=\"https:\/\/www.smartcorp.in\/tirupur\/private-limited-company-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">private limited company<\/a><strong>.<\/strong> This is due to enormous benefits associated with the business structure.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Company incorporation and commencement\nsteps:<\/h2>\n\n\n\n<p>First of all, formation of a company is a long and complicated process. The foremost step involved in forming the company is company incorporation. After that, there are several other procedures followed by the company before the commencement of the business. The <a href=\"https:\/\/www.smartcorp.in\/tirupur\/company-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">company formation<\/a> is an early and initial task. It involves certain legal formalities and procedures to be done at the initial stages. The authorities have the special powers and system that are to be followed by each and every business organisation for the business commencement.<\/p>\n\n\n\n<p>For instance, when a human being\ntakes birth, his body parts are the immense element which is being formed\nbefore taking the birth. Similarly, when a company is formed, before that it\nhas its several aspects which have to be built after which the company is taken\ninto an account to commence its business:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Promotion of a company<\/li><li>Registration of a company<\/li><li>Certificate of incorporation<\/li><li>Commencement of business<\/li><\/ul>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/one-person-company.jpg\" alt=\"Company incorporation in India: benefits of registering a company\" class=\"wp-image-107\" width=\"401\" height=\"250\"\/><\/figure><\/div>\n\n\n\n<h4 class=\"wp-block-heading\">Promotion of a company:<\/h4>\n\n\n\n<p>The process of business promotions comes when someone comes up with the good idea and that idea is converted into action. (i.e.) the <a href=\"https:\/\/www.smartcorp.in\/tirupur\/company-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">formation of the firm <\/a>and commencement of the business. It is the effort thrown by the members of the company put to make the company.<\/p>\n\n\n\n<p>A successful promoter is the\ncreator of wealth. The person who is related to the promotion of a particular\nbusiness or an enterprise is known to be a promoter. For example, Dhirubhai Ambani\nis the promoter of Reliance Industries. He created the idea of starting a\nbusiness and takes all the measures required for bringing the enterprise into\nthe existence. Moreover, the promoter\nfinds out the way to generate the money, search business idea, arranges for\nfinance, gather resource and establish a going concern. The company law does\nnot give any legal status to promoters. He stands in fiduciary position.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/company.jpg\" alt=\"Company incorporation in India: benefits of registering a company\" class=\"wp-image-108\" width=\"362\" height=\"241\"\/><\/figure><\/div>\n\n\n\n<p>There are different types of the promoter, occasional promoters, company promoter, financial promoter, entrepreneurs, lawyers, and engineers etc. They all play different roles during the<strong> <\/strong><a href=\"http:\/\/www.solubilis.in\/company-registration-chennai.php\">company<\/a> incorporation, and all of them only hold a fiduciary position until such company is incorporated.<\/p>\n\n\n\n<p>Once the promoters have decided\nto launch a company next step is to select a name for the company and get it\nregistered with the registrar of companies of the state in which the registered\noffice of the company is to be situated. An application with three names, in\nthe order of their priority, is filed with the registrar to get the name\napproved.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Registration of company :<\/h4>\n\n\n\n<p>Consequently, the <a href=\"http:\/\/www.solubilis.in\/company-registration-chennai.php\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">company registration<\/a> is nothing but giving birth or existence to a company. A company is properly effectively when it is registered under the companies act. There are certain procedure for the registering the company, it should be followed by each and every organisation. Meanwhile, it involves the following documents and procedures,<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">Memorandum of Association:<\/h6>\n\n\n\n<p>&nbsp;It is signed by minimum member that is 7 persons for the <a href=\"https:\/\/www.smartcorp.in\/tirupur\/public-limited-company-registration\">public company<\/a> and 2 in case of private company. It should be duly stamped.<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">Articles of Association:<\/h6>\n\n\n\n<p>&nbsp;The document is signed by all persons who have\nsigned the memorandum of association.<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">List of directors: <\/h6>\n\n\n\n<p>A list of directors with their\nnames, address, and occupation is prepared and filed with the registrar of the\ncompanies.<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">Written consent of the directors:\n<\/h6>\n\n\n\n<p>A written consent of the\ndirectors that they had agreed to act as directors has to be filed with the\nregistrar of the company along with a written approval to the effect that they\nwill take the qualification shares and will pay for them.<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">Notice of the address of the\nregistrar office: <\/h6>\n\n\n\n<p>Consequently, it is also necessary to file the notice of the address of the company\u2019s registered office at the time of incorporation. It is to be provided within 30 days after the date of incorporation.<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">Statutory declaration: <\/h6>\n\n\n\n<p>A statutory declaration mentioning that the requisites of the act and the rules there-under have been compiled. It must be signed by an advocate of the Supreme Court entitled to appear before a high court or a practicing chartered accountant in India, who engages in the company incorporation or by a person indicated in the article as a director, managing director, secretary or manager of a company.  Moreover, it is also to be filed with the registrar of the company.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Company Incorporation certificate<\/h4>\n\n\n\n<p>The registration of the\nmemorandum of the association, the article of association and other documents\nare filed with the registrar of the company. After getting fulfilled with the\napplication &amp; documents submitted, Registrar will issue the Certificate of\nincorporation\u2019. A certificate of incorporation is the ultimate proof for the\nexistence of a company.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img loading=\"lazy\" decoding=\"async\" width=\"269\" height=\"187\" src=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/certificate-of-incorporation.jpg\" alt=\"\" class=\"wp-image-109\"\/><\/figure><\/div>\n\n\n\n<h4 class=\"wp-block-heading\">Certificate of Commencement of\nBusiness<\/h4>\n\n\n\n<p>As soon as a private company gets the certification of <a href=\"https:\/\/www.smartcorp.in\/tirupur\/company-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"incorporation (opens in a new tab)\">incorporation<\/a><strong> <\/strong>it can start its business. Once the certificate of incorporation is received by the company, a public company issues a prospectus for inviting a public to subscribe to its share capital. It fixes the minimum subscription in the prospectus. Then it is required to sell the minimum number of shares mentioned in the prospectus. <\/p>\n\n\n\n<p>After completing the sale of the\nrequired number of shares, the certificate is sent to the registrar along with\nthe letter from the bank stating that all the money is received. The registrar\nthen inspects the documents. If all the legal formalities are done then the\nregistrar issues a certificate known as \u2018certificate of commencement of businesses.\nThis is the conclusive evidence for the commencement of business for the public.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Company incorporation &#8211; Types:<\/h3>\n\n\n\n<p>The different types of company\nformation are:&nbsp; Private limited company,\npublic limited company, one Person Company, Nidhi Company, proprietorship\nregistration, section 8 company, limited liability partnership, Partnership\nfirm registration, non-banking finance companies etc.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Private limited company\nregistration:<\/h5>\n\n\n\n<p>Private limited company\nregistration offers multiple benefits such as ease of formation, limited\nliability, freely transfer of shares, easy to raise funds, etc. Private Limited\nCompany is nothing but a privately held business with a minimum of 2 and\nmaximum of 200 members.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img loading=\"lazy\" decoding=\"async\" width=\"500\" height=\"185\" src=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/private-limited-company-registration.jpg\" alt=\"\" class=\"wp-image-110\" srcset=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/private-limited-company-registration.jpg 500w, https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/private-limited-company-registration-300x111.jpg 300w\" sizes=\"auto, (max-width: 500px) 100vw, 500px\" \/><\/figure><\/div>\n\n\n\n<h6 class=\"wp-block-heading\">Factors that are affecting the\ncost of private limited company registration<\/h6>\n\n\n\n<p>First of all, the procedure of private limited company is almost same in every and each state. However, the cost involved in <a href=\"https:\/\/www.smartcorp.in\/tirupur\/private-limited-company-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"private limited company registration (opens in a new tab)\">private limited company registration<\/a> is different compared to other company registration. Moreover, there are several other factors that bear the cost of private limited company registration. The Certain factors that the cost of company registration will depend-<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Authorized Share Capital of the company<\/li><li>Number of Directors in the company<\/li><li>Stamp Duty of the State where the company is\nproposed to be registered<\/li><li>Charges are taken by professionals like Chartered\naccountants or Lawyers.<\/li><\/ul>\n\n\n\n<h5 class=\"wp-block-heading\">Public limited company registration:<\/h5>\n\n\n\n<p>A public company has to follow much more consequences compared to a Private limited company. It can deal in both secured and unsecured debts. A public limited company allows you to trade in the market and issue shares, debentures and accept deposits.  Similarly, a public limited company registration is always beneficial because a public limited company is preferred to provide big financial loans as compared to <a href=\"https:\/\/www.smartcorp.in\/tirupur\/llp-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"Limited liability partnership  (opens in a new tab)\">Limited liability partnership <\/a>and Firms. <\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/public-limited-company.jpg\" alt=\"\" class=\"wp-image-111\" width=\"404\" height=\"198\" srcset=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/public-limited-company.jpg 321w, https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/public-limited-company-300x147.jpg 300w\" sizes=\"auto, (max-width: 404px) 100vw, 404px\" \/><\/figure><\/div>\n\n\n\n<p>However, at least it must have at least minimum of 3 directors and 7 members or shareholders; there is no upper limit for the maximum number of the shareholder. The public limited companies can be started with an initial capital of 1lakh. Every <a href=\"https:\/\/www.smartcorp.in\/tirupur\/public-limited-company-registration\">Public company<\/a> need to conduct board and general meetings within the prescribed time as per Companies Act, 2013. Every Public company is required to get their accounts audited annually as per the provisions of the Companies Act, 2013. Articles of association are the charter for the company that defines its scope of operations.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">One person company registration:<\/h5>\n\n\n\n<p>Moreover, Section 2(62) of Companies Act defines a <a href=\"https:\/\/www.smartcorp.in\/tirupur\/one-person-company-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"one person company (opens in a new tab)\">one person company<\/a> as a company which has only one person as its member. Furthermore, members of a company are nothing but subscribers to its memorandum of association. So, an OPC is a company that has only one shareholder as its member.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/opc-registration.png\" alt=\"\" class=\"wp-image-112\" width=\"328\" height=\"223\"\/><\/figure><\/div>\n\n\n\n<p>Such companies are generally\ncreated when there is only one promoter for the business. Entrepreneurs whose\nbusinesses lie in early stages prefer to start OPCs instead of sole\nproprietorship business because of the several advantages that OPCs offer. Moreover,\nonly natural persons can become members of OPCs. This does not occur in the\ncase of companies where the companies themselves own shares and be members.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Section 8 company registration:<\/h5>\n\n\n\n<p>The primary objective of the <a href=\"https:\/\/www.smartcorp.in\/tirupur\/section-8-company-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"section 8 companies (opens in a new tab)\">section 8 companies<\/a> are working for the development of the society, protection of the earth and environment, working in the field of art, commerce, literature, sports, protection of living creatures, research, and development, etc. without earning any profit.&nbsp;In other words, section-8 Company is a non-profit organization whose main aim is to contribute its effort for the development and betterment of the society, but under companies act this non-profit organization is known as section-8 Company.<\/p>\n\n\n\n<p>There should be minimum two shareholders and two Directors (Directors and shareholders can be the same person); At least one of the Director should be the resident in India. There is no minimum capital for section 8 companies.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Limited liability partnership:<\/h5>\n\n\n\n<p>Further more, the Limited liability partnership is the good choice for those who are involving in the business of consultancy. LLP have little compliance to follow as compared to other companies. Under Indian Partnership Act, 1932 the registration of <a href=\"https:\/\/www.smartcorp.in\/tirupur\/partnership-firm-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"partnership firm (opens in a new tab)\">partnership firm<\/a>, but if any person wants to run LLP, and then he shall have to take a certificate of registration from the Registrar and register the LLP agreement. Consequently, all the details of the business such as profit &amp; loss sharing ratio amount of capital invested should be mentioned in the LLP agreement. <\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Non-banking finance companies:<\/h5>\n\n\n\n<p>In essence, NBFCs or <a href=\"https:\/\/www.smartcorp.in\/tirupur\/nbfc-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"Non-banking financial company (opens in a new tab)\">Non-banking financial company<\/a> as it is commonly known as in India is the financial institution that provides the banking services without any bank licenses. Moreover, they are allowed to perform some banking activities but they do not require any pre-banking licenses for such activity. The NBFCs in India runs under the companies\u2019 act which came into place in 1956. Services provided by NBFCs include investment, hire purchase, and chit funds.<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/nbfc-registration.jpg\" alt=\"\" class=\"wp-image-114\" width=\"364\" height=\"217\"\/><\/figure><\/div>\n\n\n\n<p>There are different types of\nNon-banking Finance companies in India such as loan companies, asset finance\ncompanies, and investment companies. The main purpose of the loan companies is\nto provide loans and advances. Asset finance companies provide the finance the\nassets of a company like machines, equipment, etc.<\/p>\n\n\n\n<h5 class=\"wp-block-heading\">Proprietorship registration: <\/h5>\n\n\n\n<p> Besides, the proprietorship registration is the good practice for the start of small scale business. Moreover, it does allow the business to scale up and reach maximum growth as the many of the features are missed out in a proprietorship firm.  In particular, the features of proprietorship are transfer of shares; limited liability, easy funding process etc. are major things a growing business should possess. A <a href=\"https:\/\/www.smartcorp.in\/tirupur\/proprietorship-registration\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"proprietorship firm (opens in a new tab)\">proprietorship firm<\/a> can be converted into a company by executing a proprietorship takeover agreement.<\/p>\n\n\n\n<h6 class=\"wp-block-heading\">Choose proprietorship because<\/h6>\n\n\n\n<ul class=\"wp-block-list\"><li>A sole Proprietorship is cheaper as compared to\nOPC.<\/li><li>A proprietorship with income of less than Rs. 2\nLakhs per annum is not required to pay income tax.<\/li><li>Easy to establish with less formalities.<\/li><\/ul>\n\n\n\n<p>We Smartcorp are one of the leading business service providers in major city like Tirupur. We offer easier, simpler <strong>company <\/strong>incorporation services with an outstanding customer support. Experts professional, no hidden cost, 24\/7 customer support. Hurry up!!<\/p>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter is-resized\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/www.smartcorp.in\/blog\/wp-content\/uploads\/2019\/06\/Company-incorporation-in-India-316x1024.jpg\" alt=\"\" class=\"wp-image-130\" width=\"455\" height=\"1474\"\/><\/figure><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Chiefly, India is a major place where the start-ups and the entrepreneurs are growing rapidly. Company incorporation is not an&hellip;<\/p>\n","protected":false},"author":1,"featured_media":105,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-96","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-company-registration-business-services"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\r\n<title>Company incorporation in India: Benefits of registering company<\/title>\r\n<meta name=\"description\" content=\"In the article we have discussed about the company incorporation features and the types of company filing available in detailed manner.\" \/>\r\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\r\n<link rel=\"canonical\" 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