Private Limited Company

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Issue of Share Certificate in Private Limited Company: A Step-by-Step Tutorial

Posted on by Fastlegal Team

In this Article we will discuss A Step-by-Step Tutorial on Issue of Share Certificate in Private Limited Company, Issuing share certificates in a private limited company is an important procedure as it serves as proof of share ownership for shareholders. This document outlines the steps necessary to issue share certificates.

Step 1: Authorization from the Board of Directors

Before issuing any share certificates, the company must hold a board meeting to authorize the issuance of shares. The board resolution should include the number of shares to be issued, to whom, and at what price.

Step 2: Receive Payment for Shares

The company should ensure that the payment for the shares has been received as per the terms agreed upon. The payment should be in accordance with the price per share fixed by the company.

Step 3: Preparation of Share Certificates

Prepare the share certificates using the company’s standard format. According to the Companies Act, the certificate should include:

  • The company name and registration number
  • The name of the shareholder
  • The number of shares held and the share certificate number
  • The amount paid on those shares

Ensure that each certificate is signed by two directors or by a director and a company secretary, if appointed.

Step 4: Make Entries in the Register of Members

The company must enter the details of the issued shares in the Register of Members. The details should include the name of the shareholder, the number of shares, the date of issue, and the certificate number.

Step 5: Stamp Duty

Ensure that share certificates are stamped to comply with the stamp duty regulations applicable in your jurisdiction. This step usually involves paying the required duty and having the share certificate stamped by the appropriate authority.

Step 6: Issue the Share Certificates

Once the share certificate is duly stamped and signed, it should be issued to the shareholder within two months of the allotment of shares or the date of the transfer, as stipulated by the Companies Act.

Step 7: Report the Issuance of Share Certificates

The issuance of share certificates must be reported to the Registrar of Companies within a prescribed period, usually through the filing of specific forms that detail the allotment of shares.

Step 8: Update the Register of Allotments

Finally, the company must update its Register of Allotments with details similar to what is mentioned in the Register of Members. This register keeps track of all allotments made by the company since its incorporation.

Conclusion

Issuing share certificates is a legal requirement that must be accurately completed to ensure compliance with regulatory requirements. Always refer to the latest provisions of the Companies Act in your jurisdiction to ensure compliance with all legal formalities.

Remember that this guide is a general overview and might require alterations based on location-specific laws governing private limited companies and their share issuance procedures. It is advisable to consult a legal expert or a company secretary /chartered accountant for company-specific compliance.

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Step-by-Step Tutorial on Mandatory Legal Compliance for Private Limited Companies under Companies Act, 2013

Posted on by Fastlegal Team

Operating a Private Limited Company in India involves adhering to numerous mandatory compliances as mandated by the Companies Act, 2013. These set the legal framework within which companies must operate and report various aspects of their business. Here’s a step-by-step guide to ensure your company meets all mandatory legal compliances:

Step 1: Convene the Initial Board of Directors Meeting

  • Hold the first meeting of the Board of Directors within 30 days of company incorporation.
  • Schedule at least four board meetings throughout the financial year, maintaining a maximum gap of 120 days between two meetings.

Step 2: Issue Share Certificates

  • Issue Share Certificates to the subscribers of the memorandum within 60 days of incorporation.
  • Keep a record of the share certificates issued for transparency and statutory compliance.

Step 3: Appoint Statutory Auditors

  • Appoint a practicing Chartered Accountant as the company auditor.
  • This appointment should be made by the Board of Directors within 30 days of incorporation, or by the members in an Extraordinary General Meeting within 90 days.
  • Re-appoint or ratify the appointment in each subsequent Annual General Meeting.

Step 4: Document Board and General Meetings Minutes

  • Record the minutes of all Board of Directors and General meetings.
  • Ensure this is completed within 30 days following the conclusion of each meeting.

Step 5: Disclose Directors’ Interests

  • Each director must disclose any interest in other business entities at their first board meeting as director and subsequently at the first board meeting in each financial year.
  • Submit their disclosures in FORM MBP-1.

Step 6: Approval and Signing of Financial Statements

  • Approve financial statements in a board meeting.
  • Sign them on behalf of the Board by the chairperson or two directors, and by the CFO and Company Secretary if appointed.
  • Submit these for auditing.

Step 7: Prepare Board of Directors’ Report

  • Attached to the general meeting financial statements, include a report detailing the state of the company and its compliance with financial and corporate standards.

Step 8: File Financial Statements

  • File the company’s Financial Statements with the Registrar of Companies within 30 days of the Annual General Meeting using E-FORM AOC-4.
  • Ensure the form is digitally signed by at least one director and certified by a professional if required.

Step 9: File Annual Returns

  • File the company’s Annual Return with the Registrar of Companies within 60 days of the Annual General Meeting using E-FORM MGT-7.
  • Have the form digitally signed by at least one director and certified by a Company Secretary in practice if necessary.

Step 10: Maintain Statutory Registers

  • Keep up-to-date statutory registers including:
    • FORM MGT-1: Register of Members
    • FORM MGT-2: Register of Debenture Holders
    • FORM MGT-3: Foreign Register of Members and other security holders
    • FORM SH-2: Register of Renewed and Duplicate Share Certificates
    • FORM SH-3: Register of Sweat Equity Shares
    • FORM SH-6: Register of Employee Stock Options
    • FORM SH-10: Register of Shares or Securities Bought Back
    • FORM CH-7: Register of Charges

Ensure you regularly review compliance regulations as they may be subject to changes. Non-compliance could result in penalties, so maintaining diligence in these areas is crucial for the ongoing operation of your Private Limited Company. Lastly, always confirm with legal advisers or professional consultants to ensure full compliance according to the latest amendments in the law.

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Share Certificate in Private Limited Company in India

Posted on by Fastlegal Team

A Share Certificate is a legal document which is issued by a private limited company in India to its shareholders in which the number of shares owned by them is mentioned. It is a legal document which serves as a proof of ownership of shares in the company and acts as a primary evidence of the same. It is usually signed by the company’s authorised signatory and the company’s seal is affixed on it. It is a crucial document which is required whenever the shareholder wishes to transfer or sell the shares.

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Frequently Asked Questions on Private Limited Company Registration in India with Foreign Directors & Members

Posted on by Fastlegal Team

Registration of Private Limited Company in India with foreign Directors and Members is more or less similar to that of normal private limited company with Indian Directors and shareholders except that if foreign nationals are incorporating a company in India there is compliance requirement of Companies Act, FEMA applicable in case of foreign nationals are required to be complied with, here we have listed some frequently asked questions on private limited company registration with Foreign nationals in India

Private Limited Company Registration in India with Foreign Directors

Can two  Foreign Companies form a Company in India?

 Yes, representatives of these companies may be appointed as Directors in Indian Company, one of them should be Indian Resident.

Can a Company may be registered without any object?

No, as per Indian laws a Company must have a lawful object at the time of Incorporation.

Is foreign National is required to visit India for registration of Company?

No, Company registration is 100% online process, they just need to send scanned copy of documents required.

Is the Company required to hold Compulsory Board Meeting and if so does foreign national is required to come India for such meetings?

Yes, Company is required to hold 4 Board Meetings during the financial year BUT foreign directors are not required to visit India for attending the meeting. A meeting may be held through video conferessing.

Can registered office may be situated outside India?

No, it must be situated in India Only.

Can a foreign Company register a Wholly Owned Subsidiary Company in India?

Yes, a foreign company may do so but the new company must have a resident Indian Director.

Who is resident in India?

Every Company shall have at least one Director who has stayed in India for a total period of not less than 182 days in the previous calendar year.

Is there is any RBI Compliance required to be done when there is Foreign Capital Inflow in Company?

In  Sectors where 100% FDI is allowed under Automatic Route, there is no requirement for RBI Approval but Company is required to make reporting of these transaction to RBI to Authorized Dealer Bank.

What documents are required from Foreign National to get Digital Signature and Director Identification Number ?

Notarized or apostilled Copy (if a Commonwealth country) of Passport in support of address and identity proof along with duly.

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Main objects of Interior Decorator Company

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Main objects of Interior Decorator Company:
To carry on in India or elsewhere the business to manufacture, develop, fabricate, finish, manipulate and to act as importer, exporter, buyer, seller, job worker, wooden beading and mouldings, wooden packing cases, and to carry on either alone or jointly with one or more persons, government, local or other bodies, the business of to undertake Architectural work, inter designers, erection and installation and to act as civil engineers, architectural engineers, interior decorators, consultants, advisors, contractors, turnkey contractors and managers, and to do all incidental acts and things necessary for the attainment of the above objects.

Book on Company Law

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Mandatory Filings for Private Limited Companies in Current Financial Year 2019-20- ROC and Income Tax

Posted on by Fastlegal Team

IMPORTANT FORMS TO BE FILED

E-form Purpose of the Form When to File
DIR-3 KYC  Any person who has been allotted “Director Identification Number(DIN/DPIN) needs to file DIR-3-KYC to update KYC details On or before 30th June of every financial Year
Form DPT-3

 

 Return of Deposits

One time return of outstanding receipt of money or loan by a company which is not considered as deposits as per rule 2 (1) (c)

 

Filling is required to be done for both secured & unsecured outstanding money/loan not considered as deposits.

 

Period of outstanding loan/money shall be from April 01, 2014 till March 31st, 2019.

 On or before 29th June, 2019
MSME 1 Details of all outstanding dues to Micro or small enterprises suppliers –          within 30 days from the deployment of form on MCA i.e. 30th May, 2019 after that half yearly

–          For the period of April to September-by 31st October

–          For the period of October to March-by 30th April.
ADT-1 For appointment of Auditor Within 15 days of the AGM
Form INC 22A Active Active Form – for Verification of Office and Compliance 15th June

https://fastlegal.in/blog/company-law/active-form-inc-22a-date-extended-15th-june/
AOC-4 Financial Statement Within 30 days of the AGM
MGT-7 Annual Return Within 60 days of the AGM
DIR-12 Addition, cessation, or change in designation of directors Within 30 days of the Event
Income Tax Return Income Tax Return for Private Limited Company On or before 30th September, 2019
TDS Return Tax Deduction To be filed quarterly within 30 days of end of quarter, except in case of Quarter ending on March, in which return to be filed within 90days from the end of quarter?

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How to Change the Nominee or Member of One Person Company

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Every One Person Company shall always have Nominee of Member, that who shall become the member of the company in the event of death or incapacity to contract of member of Once Person of the Company.

First Nominee is declared at the time of Incorporation of company  with consent of nominee form INC -3

Now in case Member of One Person of the company wanted to Change the Nominee of Member than he can do so by Filing prescribed form to Registrar of Companies in Form INC-4

Form INC-4 is required to Filed in Following Cases :

  1. Notice of withdrawal of consent by the nominee of OPC
  2. Intimation about change in the name of the nominee of OPC
  3. Intimation of Cessation

Notice of withdrawal of consent by the nominee of OPC: 

Form INC-4 is required to filed when the Nominee has withdrawal consent to act as nominee of OPC, than the member of the Company shall nominate any other person as Nominee of the Company by taking consent of nominee in form INC-3 along with ID and Address Proof of Nominee.

Intimation about change in the name of the nominee of OPC:

Form INC-4 is required to be when there is change in nominee due to Change in Nominee by Member of OPC

Intimation of Cessation:

When the Member of the Company ceased to be member of the Company due to

  • transfer of ownership of the company to other person ,
  • Death of the member
  • Incapacity of member to contract

In this case the transferee or the nominee will become the member of the company.

In case of Change in Member either member can choose to Change the Nominee to new person or the existing nominee can remain the nominee.

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Step by Step Procedure for Private Limited Company Registration in India

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Private Limited Company is the most common incorporated business organisation in India. It limits liability of its members & has a perpetual succession. For starting a Private Limited Company minimum 2 members and directors are required. In this article we provide a comprehensive guide to Private Limited Company registration as per the provisions of Companies Act,2013.

Type of Business Entities for doing business in India :

Private Limited Company :

Private Limited Company is the most popular structure for businesses and startups. Private Limited Company allows outside funding & Foreign Direct Investment easily. Private Limited Companies are required to hold Board Meetings,Register Secured Loans with Ministry of Corporate Affairs,Hold Members Meeting for Important matters,Make complete disclosures about important matters in their Board Report. Due to all these regulatory disclosures and requirements imposed on Private Limited Company by Company Law they tend  to be viewed with more credibility than a Limited Liability Partnership (LLP), One Person Company (OPC), or General Partnership.

Limited Liability Partnership:

Limited Liability Partnership is suitable for Service based industry (for example-web designing,architects,doctors etc.). In comparison to general partnerships it limits the liability of its Partners. However, if you’re looking to raise venture capital or attract talent with employee stock options, private limited is the way to go as LLPs cannot easily accommodate it.

Partnership Firm :

General Partnership Firm is thought to have lost its relevance since the introduction of the Limited Liability Partnership (LLP) because its partners have unlimited liability, which means they are personally liable for the debts of the business. However, low costs, ease of setting up and minimal compliance requirements make it a sensible option for some, such as home businesses that are unlikely to take on any debt. Registration is optional for General Partnerships.

Procedure for Incorporation of Private Limited Company

Following are the steps involved in Incorporation of a Private Limited Company in India:

Obtaining Digital Signature: 

Digital Signature is required to sign Incorporation application and other forms for regular compliance needs,It is issued by certifying authority (like Sify,Vsign, Emudra etc.).

Following are the documents required for obtaining Digital Signature for Directors:

1.) For Indian citizens & residents:

a.) Copy of Pan Card

b.) Copy of Driving license/Passport/Aadhar Card/Voters’ Identity Card

c.) Dully filled and signed Digital Signature Form.

2. For Foreign Nationals:

a.) Copy of Notarized or Appostilled Passport if the country is a party to hague convention.

b.) Dully filled and signed Digital Signature Form.

Name Approval Application in E form RUN:

Application for Name approval may be filled using E-FORM RUN . Care must be taken while applying for Name approval, Name of proposed Company must not resemble with an already registered Company and a Registered Trademark or with the mark for registration of which Trademark application has been filled.

We will help you to check the name availability for your new Company.

Preparation of Incorporation Documents:

  • Form INC -9 ( Declaration from First Subscribers and Directors )
  • Form DIR-2 (consent to Act as Director )
  • E MOA
  • E AOA

What is E MOA and E AOA :

  • E MOA is Memorandum of Association of the Company i.e. Constitutional  Document  in which Name of the Company , State of Registered Office of the Company, Main Objects of the company, Share Capital of the Company and Liability of Members are mentioned.
  • E AOA is Articles of Association of the Company i.e. in which Rules and Regulations for governing of the Company is mentioned.

Our Team will help you to get your E MOA and AOA drafting as your requirements.

Shareholding (Ownership)  in the Proposed Company , how it is decided :

In this case if you are two persons starting a New Company it is important that what ownership you will held in the proposed Company , Lets take and Example – We will Incorporate a Private Limited Company which will have Share capital Divided into 10000 Equity Share Shares of Rs. 10 Each in this case We divide 5000 Share each to both the persons , the ownership will be 50-50% for both the persons. Ownership decides the voting rights of members in the proposed Company.

In New Company Share are subscribed by mentioning the no of shares in the Subscription page of MOA of the Company and it is witnessed by  Company Secretary, Chartered Accountant or Cost Accountant in Practice.

Subscribing to Memorandum and Articles of Association:

By subscribing to Memorandum and Articles of Association members agree to become member of Proposed Company. Following are the manner for Subscribing to Memorandum and Articles of Association:

1.) If all the members are Indian resident Individuals:

Subscriber sheets of Moa & Aoa must be signed by respective individuals stating the shares subscribed against their name in Moa Subscriber Sheet.

2. If members include Body Corporate or only Body Corporate are members:

Subscriber Sheet must be signed by nominee of Body Corporate who is authorized by a resolution passed by Board of Directors for subscribing on behalf of Company and other individual subscribers.

3. In case foreigner are members of proposed Company:

 Subscriber Sheet of Moa & Aoa is required to be signed by respective individual or nominee of Body Corporate and must be Notarized by Notary Public of that Country if the country is not a party to Hague convention if that country is a party of Hague convention than it must be appostilled accordingly.

Filling of Incorporation Application to CRC:

Once all the above processes are completed than incorporation application may be filled using the forms available on website of Ministry of Corporate Affairs.

Obtaining DIN and Name Approval can directly be made through SPICE form. GST Registration can also be applied along with Spice form through AGILE.

Opening of Company Bank Account :

It is very much advisable to open a Company Current Bank Account as soon as company is registered, and deposit the subscription money to company bank account .

Filing of Form INC 20A for Commencement of business of Company :

The Company has to file form INC 20 A for Commencement of Business of the Company , Company cannot Commence and exercise borrowing powers if company does not file form INC 20A .

Place your Request for Private Limited Company Registration Online in India

Call us directly at 9782280098

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Main objects of Publication and Distribution Service Company

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To carry on in India or elsewhere the business as printers, publishers, typesesster, DPT operators, proofreaders, binders, cutter, perforators, laminators, designers, authors, writer and editors of publication all varieties, descriptions, specifications, applications & uses including books, novels, magazines, journals, souvenirs, newsletters, periodicals, bulletins, pamphlets, forms catalogues, diaries, calendars, posters, pictures, stickers, text books, law books, school books, college books, newspapers & other allied publications on any subject whatsoever in print as well as in electronic media and to develop software, CDs, cassettes, floppies or any other electors mode, devices, systems and to act as job work, contractor, sub-contractor, consultant, date entry operator, page maker, website designer, copyright owner and to deal in all goods, articles and things necessary for the attainment of the above objects.

 

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Main objects of Information Technology (IT) Services Company

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To carry on the business of Software designing, development, customisation, implementation, maintenance, testing and benchmarking, designing, developing and dealing in computer software and solutions, and to import, export, sell, purchase, distribute, host (in data centers or over the web) or otherwise deal in own and third party computer software packages, programs and solutions, and to provide internet / web based applications, services and solutions, provide or take up Information technology related assignments on sub-contracting basis, offering services on-site/ offsite or through development centers using owned /hired or third party infrastructure and equipment, providing recruitment and HR related services, providing and taking personnel / consultants/ human resources to / from other organizations, providing solutions/ Packages/ services through applications services provider mode via internet or otherwise, to undertake IT enabled services like call Centre Management, Medical and legal transcription, data processing, Back office processing, Accounting, HR and payroll processing, Insurance claims processing, credit card processing, loans and letters of credit processing, cheque processing, data warehousing and database management, to carry on the business of manufacturing, dealing and maintenance of computer hardware, computer systems and assemble data processors, program designs and to buy, sell or otherwise deal in such hardware and software packages and all types of tabulating machine, accounting machines, calculators, computerized telecommunication systems and network, their components, spare parts, equipments and devices and to carry on the business of establishing, running and managing institutions, school, and academics for imparting education in computer technology, offering equipment, solutions and services for Networking and network management, data centre management and in providing consultancy services in all above mentioned areas.

To develop, provide, undertake, design, import, export, distribute and deal in Systems and application software for microprocessor based information systems, off shore software development projects, internet service provider, and solutions in all areas of application including those in Emerging niche segments like Internet and Intranet website applications solutions software enterprise, resource planning, e-commerce, value added products and other business applications either for its own use for sale in India or for export outside India and to design and develop such systems and application software for and on behalf of manufacturers owners and users of computer, telecom, digital, electronic equipments in India or elsewhere in the world.

To manufacture, sell, export, import all kinds of electric & electronic components capable of being used in Electrical & mechanical and electronic Industries including Computers telecommunications to carry our software research and development, to design and develop system software, application software and any other software in India and abroad to start Integrated services Digital Local Network ( ISDLAN ) dial for data Centers technology parks, wide area network Internet, user net, cyber café services in India and abroad.