Convert Proprietorship to Private Limited Company

Directors Identification Number (DIN) is an identification number issued by the Ministry of Corporate Affairs, Government of India, to Directors of a company or Designated Partners of an LLP.

New DIN will be allotted to a Director / Designated Partner while registering a Company or LLP. Also, a Company / LLP can apply for a DIN for a proposed Director / Designated Partner.

Minimum Number of 2 Shareholder and 2 Directors required for registering a Private Limited Company.

Shareholders could be Individuals, Companies or LLPs, but only individuals can become directors of the company.

MOA is the charter document of a company. A company is created by registering a memorandum. MOA contains the name of a company, the state in which the registered office of the company is located, objectives, and its authorized capital. The MOA will be subscribed by the initial promoters of the company in their own handwriting. They will also have to write their name, father’s name, residential address, occupation and the number of shares they agree to subscribe in the company. The MOA should also bear the signature of the witness who knows the subscribers.

AOA contains rules and regulations for the management of a company’s internal affairs and conduct of its business. It defines the relationship of company between its members and directors and relation between members and directors. It also describes powers of directors. Further, the AOA describes the rights and duties of its members as well as the duties and responsibilities of its directors. In case of a private limited company, the AOA will contain the restrictions of transfer of shares, if any. Also, AOA usually contains the names of first directors of a company.

The AOA will be subscribed by the initial promoters of the company in their own handwriting. Promoters will have to write their names, father’s name, residential address, and occupation. The AOA should also bear the signature of the witness who knows the subscribers.

Authorized capital shows the maximum amount of capital that a company can raise by way of issue of shares at present or in the future. Whereas, the Paid-up Capital refers to the actual amount raised by a company i.e.; amount paid by the shareholders on the issuance of shares. One can register a company in India by any amount of paid-up capital which can be less or equal to the authorized capital but not exceeding the authorized capital.

Yes, a Private Company can carry multiple businesses if it is mentioned in the company’s MoA and approved by a registrar. The company can mention more than one business operating within the same field or of the same nature. Activities which are unrelated, such as fashion designing and event management or construction, those cannot be registered under the same company.

Yes, NRIs or foreigners can hold shares subject to FDI guidelines. However, a foreign participation above 50% will place the company under the category of Foreign Company.

Does anyone has to be physically present for online company registration in India?

No, none of the promoters are required to be present when opted to register a company online. All the forms are filed on the web portal and are digitally signed. Also, the required documents can be sent through e-mail or uploaded on our portal for filing.

Once, the company is registered, it should follow below-mentioned requirements on priority:

1. The opening of the company’s current account within 30 days after receiving the PAN card.
2. Appointment of a Statutory Auditor
3. Depositing paid-up capital as mentioned while registration
4. Issue and allotment of shares

During every financial year, the company must hold one Annual General Meeting (AGM) and at least 4 board meetings (one in each quarter). Further, the accounts and financial statements must be audited by an independent auditor. Subsequently, it shall file form AOC – 4 and MGT – 7 as part of Annual Compliance within given time.