PRIVATE LIMITED COMPANY REGISTRATION

 

Basic Information

 

Private Limited Company is the most prevalent and popular form of business structure in the world. The registration of Private limited company in India is mainly governed by the Companies Act, 2013 read with Companies Incorporation Rules, 2014. To register a private limited company, minimum two shareholders and two directors are required. A natural person can be both a Director and Shareholder, while a corporate legal entity can only be a shareholder. Further, foreign nationals, foreign corporate entities or NRIs are allowed to be Directors and/or Shareholders of a Company with Foreign Direct Investment, making it the preferred choice of entity for foreign promoters.

 

Unique features of a Private Limited Company like limited liability protection to shareholders, ability to raise equity funds, separate legal entity status and perpetual existence make it the most recommended type of business entity.

 

LEGALRAJ provides company registration services, offering a variety of Company registrations like private or Public Limited Company, One person company, Nidhi Limited, Section 8 company, Producer Company. The average time taken to complete a Company registration is about 7 to 15 working days, subject to government processing time and client document submission. Get a free consultation on Company registration and business setup in India by scheduling an appointment with LEGALRAJ.

 

Advantages of Private Limited Company Registration

 

1. Separate Legal Entity: Private Limited Company is a legal entity and a juristic person established under the Companies Act, 2013. Hence, a company has a wide range of legal capacities and the members (Shareholders/Directors) of a company have no personal liability to the creditors of a company for company's debts.

 

2. Uninterrupted Existence: Private Limited Company has 'perpetual succession', which means uninterrupted existence until it is legally dissolved. A company being a separate legal person, is unaffected by death or other departure of any member and it continues to be in existence irrespective of changes in ownership.

 

3. Borrowing Capacity: Private Limited Companies can raise equity funds or borrowed funds as per the requirements. Companies can also issue equity shares, preference shares, debentures and accept deposits with RBI permission. Banks and Financial Institutions prefer to provide funding to a company rather than partnership firms or proprietary concerns.

 

4. Easy Transferability: Ownership of a business can be easily transferred in a company by transferring shares. The signing, filing and transfer of share transfer form and share certificate is sufficient to transfer ownership of a company. In a private limited company, the consent of Board of Directors is required to effectuate share transfers.

 

5. Owning Property: Private Limited Company being an artificial person, can acquire, own, and alienate, property in its own name. The property owned by a company could be machinery, building, intangible assets, land, residential property, factory, etc., No shareholder can make a claim upon the property of the company - as long as the company is a going concern.