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Private Limited Company

Private Company formation, at an all-inclusive price, including Government Fees and applicable Stamp Duty*

Complete By* : 06 May, 2024

Price Summary

Traditional CA/CS price: ₹ 15,000 /-

Other online price: ₹ 10,000 /-


Our Base price: ₹ 5,050/-

Govt. fees & taxes: ₹ 3,440/-

You PAY: ₹ 8,490/- - all inclusive


You Save: ₹ 4,900/- - 9,900/-

*[given timeline depends on receipt of documents from the client and functioning of the Government platform(s)]

What Do You Get?

15 Mins free Consultation with EXPERT

ePAN, eTAN

Facilitate Bank account opening

IPro - basic data entry done for no time lag if Annual Compliance Package purchased

DIN for 2 (two) Directors* (Indian citizen)

ESIC, EPFO

Share Certificates (20 in nos.)

TEST 1

Incorporation Kit (incorporation certificate, Memorandum & Articles copy)

GST Registration

Combined Register

TEST 2

Why Choose SeedUp?

SAVINGS

in cost, most economical

FASTEST

completion of assignment

ADHERENCE

to compliances, giving you all that matters

RESPONSIBLE

towards your specific requirements

HASSLE FREE

we only ask for required documents

Company In The Indian Context

A Company can be : Private / Public, closely held/ widely held, unlisted/listed, non-profit company, government company, a Nidhi, producer company, subsidiary / wholly owned subsidiary or a foreign company etc.

A Company enjoys many benefits: access to a wider market, separate legal entity, it can sue and be sued in its own name, perpetual succession, access to capital markets, limited liability, it has its own Charter in which the goals/objects are stated and is known as Memorandum of Association as well as a rule book for running of the Company called the Articles of Association.

The people who contribute money to the Company are called shareholders. They are the owners of the Company. They form a small body and employ/elect people to run the Company and this small body is called the Board of Directors.

Thus, we see that as the business becomes more complex and involves more individuals, the organisational structure too evolves and becomes complex.

Just as it happens in the animal kingdom: a single celled animal- can be likened to a Sole Proprietor or an OPC, simple multi cellular organism- to a partnership or an LLP and then the complex multi cellular organism- being a Company[SB1]

Did you know: In Vedic times, a business was called a “Sreshth’, a businessman was called a ‘Sreshthi’, Guild was known as “Shreni’.

 

 

Documents RequiredHFGH

PAN CARD

Utility Bill

Aadhaar Card

Bank Statement

Passport Size Photo

* (All documents in Pdf scanned. Image file in jpeg format)

* (All documents to be Self Attested and signed on each page)

Incorporation dvsvdsv SDGDSG

Private Limited Company

The most popular form of a business structure is a private limited company, which has all the features that a startup or a successful business looking to grow larger, will need/require.

Process For Incorporation

Collect information and documents

Drafting of MoA + AoA

File Spice Form Part A-Name Reservation

File Spice Form Part B-Company Incorporation

Resubmissions, if any clarifications required by MCA

Incorporation Certificate (Digital)

File e-form for Commencement of Business (Approval)

Important Features Of A

Private Limited Company

The Ministry of Corporate Affairs- a Central government Ministry is primarily concerned with administration of the Companies Act 2013, the Companies Act 1956, the Limited Liability Partnership Act, 2008 & other allied Acts and rules & regulations framed thereunder, mainly for regulating the functioning of the corporate sector in accordance with law.

Separate Legal Entity

The Company has a distinct identity of a legal juristic person with it own PAN. It is separate from its promoters and directors.

Private

The Company has a distinct identity of a legal juristic person with it own PAN. It is separate from its promoters and directors

Liability

The word ‘limited’ is used to convey the message to public at large that the liability of the Company and it promoters and shareholders is limited- For the Company- Till the paid up capital of the Company alongwith the resources it has. For the Promoters- to the amount they have invested in the Equity of that company. For other shareholders-to the amount they have invested in the Equity of that company.

Funding

Owners fund known as equity and Borrowed funds through different modes and instruments (borrowings, deposits, debentures etc.).

Private Limited Company Vis A Vis Other Business Structures

Headings

Sole Proprietorship

Partnership

One Person Company (OPC)

Limited Liability Partnership (LLP)

Private Limited Company

Statute

Common Law

Common Law – unregistered

Indian Partnership Act, 1932- registered

Companies Act, 2013

Limited Liability Partnership Act, 2008

Companies Act, 2013

Ownership

The Proprietor- an individual

Minimum 2 partners ( a company can be a partner)

Division of Labour-

O/ship- Promoter (only one)

Daily working- Board of Director(s) (OPC may have more than 1 director)

Division of Labour-

O/ship- All partners

Daily working- Designated Partners

Division of Labour-

O/ship- Promoters and shareholders

Daily working- Board of Directors (at least 2 directors)

Legal identity & Liability

No distinct PAN.

No separate legal entity. Proprietor to bear all liabilities.

 

Distinct PAN.

No separate legal entity from its partners. Private assets of the partners can be used to meet the liabilities of the firm in case firm's assets are not adequate to meet its liabilities.

 

Distinct PAN

Separate legal entity

Limited Liability. Personal property does not get attached

 

Distinct PAN

Separate legal entity

Limited Liability. Personal property does not get attached

 

Distinct PAN

Separate legal entity

Limited Liability. Personal property does not get attached

 

Funding

Owned funds. Difficult for bank loans. Collateral of personal assets.

Owned funds. Difficult for bank loans. Collateral of personal assets.

Owned funds or debt. Cannot raise or offer equity

Owned funds. Debt funds can be managed.

For startups, Investors do not like to invest in this type of business entity

Best option if looking for business expansion I long run. Both Debt and Equity permitted.

Costs:

 

Incorporation

NIL

Very minimal.

If registered, then cost for registration. May go upto 10000/-

Presently greatly reduced. CG charges- NIL upto 15 Lakhs

Stamp Duty payable to State Governments ranging from 200/- to 10000/-

Very minimal.

Presently greatly reduced. CG charges- NIL upto 15 Lakhs

Stamp Duty payable to State Governments ranging from 200/- to 10000/-

Recurring

Trade license

Trade License

Tax Audit depending on Turnover

Filing of Forms

Auditor Fees

ITR filing fees

Other business registrations

Filing of Forms

Auditor Fees- if Turnover exceeds 40 Lakhs

ITR filing fees

Filing of Forms

Auditor Fees

ITR filing fees

Other business registrations

Taxation

Depends on personal tax slabs

Taxed at 30%. Remuneration

paid to partners can be

claimed as deduction,

restricted to the limits

speci‑ed (under the IT Act).

MAT does not apply.

No general advantages

(industry specific advantages are available). Tax to be paid at flat rate of 30% on profits, Dividend taxable in hand of receiver.

Minimum

Alternate Tax (MAT) applicable

No general advantages

(industry specific advantages are available). Tax to be paid at flat rate of 30% on profits. MAT is applicable.

Taxes on Income The following rates are applicable to the domestic companies for AY 2020-21 based on their turnover (excluding cess & surcharge):

 

Sections

Tax rate

Surcharge

Section 115BA (Applicable Manufacturing Domestic Companies

25%

7%/12%*

Section 115BAA (applicable domestic companies)

22%

10%

Section 115BAB (manufacturing)

15%

10%

Any other case

30%

7%/12%*

 Dividend taxable in hand of receiver. Minimum

Alternate Tax (MAT) applicable

Going Concern

Not survive if proprietor departs

Departure of any partner brings it to an end

Nominee is mandatory to be appointed. It will continue

It will continue even if a partner departs

It will continue as it has perpetual succession.

 

What Is A Company

The word Company come from the Latin word ‘companis’: ‘com’ meaning with or together; ‘panis’ meaning bread. Thus, Company means : to break bread together.

In the Indian context- Corporate form of economic activity is not a new age concept.

It has been a part of our inherent nature to acquire wealth. In the opening lines of the book “Corporate Life In Ancient India” written by Ramesh Chandra Majumdar, who was a lecturer on Ancient Indian History, Calcutta University ; also a Premchand Roychand Scholar, wherein he has stated “This appears from a passage in the Brihad-Aranyak-opanisad,' when read along with Sankaracharya's comments thereon. We are told that on the analogy of the Brahmans, Kshatriyas, Vaisyas and Sudras in human society, Brahma created similar classes among the gods. But he was not content by bringing into existence the first two classes alone, because they could not acquire wealth. Hence were created the Vaisyas who were called ‘ganasah’ owing to the circumstance that it was — by co-operation and not by individual effort that they could acquire wealth.”

Thus, wealth creation can be done not in isolation but as a team effort.

              

Procedure for attestation of documents:

 

In case, the director is residing outside India, then the attached supporting documents should be attested by the Consulate of the Indian Embassy, Foreign public notary.

 

 

 

A.

Proof of Identity-Passport/PAN Card

Authority of attestation

 

For Indian National (Non-Resident)-who is residing in country which is part of Commonwealth countries

Attested by India Embassy

 

For Indian National (Non-Resident)-who is residing in country which is part of Hague countries

Attested by India Embassy

 

For Indian National (Non-Resident)-who is residing in a country outside the Commonwealth and which is not a party to the Hague Apostille Convention, 1961

Attested by India Embassy

 

 

 

B

Proof of Address for Indian Citizen (RI or NRI)

Authority of attestation

 

For Indian National (Non-Resident)-Permanent address in India

Any professional CA/CS or CMA (Practising)

 

For Indian National (Non-Resident)-Present address at overseas - which is a country under Common Wealth countries

Notarised by Public Notary

 

For Indian National (Non-Resident)-Present address at overseas - which is a country under hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Indian National (Non-Resident) - Present address at overseas - -who is residing in a country outside the Commonwealth and which is not a party to the Hague Apostille Convention, 1961

1. Notarised before the Notary (Public) of such country; and

2. The certificate of the Notary (Public) shall be authenticated by a Diplomatic or Consular Officer

 

* (All documents in Pdf scanned. Image file in jpeg format)

* (All documents to be Self Attested and signed on each page)

Procedure for attestation of documents In case, the director is residing outside India, then the attached supporting documents should be attested by the Consulate of the Indian Embassy, Foreign public notary

 

 

 

A.

Proof of Identity-Passport

Authority of attestation

 

For Foreign National residing in his own country which is under Hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Foreign National residing outside his country and that country where he resides is under Hague Convention

Option A- Notarised by the Public Notary of that foreign country; and

Apostilled by the competent authority of that foreign country

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

For Foreign National residing in his own country which is under common wealth country

Notarised by the Public Notary

 

For Foreign National residing outside his country and that country where he resides is under common wealth country

Option A- Notarised by the Public Notary of that foreign country;

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

 

 

B.

Proof of Address (Foreign National)

Authority of attestation

 

For Foreign National residing in his own country which is under Hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Foreign National residing outside his country and that country where he resides is under Hague Convention

Option A- Notarised by the Public Notary of that foreign country; and

Apostilled by the competent authority of that foreign country

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

For Foreign National residing in his own country which is under common wealth country

Notarised by the Public Notary

 

For Foreign National residing outside his country and that country where he resides is under common wealth country

Option A- Notarised by the Public Notary of that foreign country;

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

For Foreign National who is from a country which is outside the Commonwealth and also not a party to the Hague Apostille Convention, 1961

1. Notarised before the Notary (Public) of such country; and

2. The certificate of the Notary (Public) shall be authenticated by a Diplomatic or Consular Officer

 

 

 

A.

Proof of Identity-Passport

Authority of attestation

 

For Foreign National residing in his own country which is under Hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Foreign National residing outside his country and that country where he resides is under Hague Convention

Option A- Notarised by the Public Notary of that foreign country; and

Apostilled by the competent authority of that foreign country

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

For Foreign National residing in his own country which is under common wealth country

Notarised by the Public Notary

 

For Foreign National residing outside his country and that country where he resides is under common wealth country

Option A- Notarised by the Public Notary of that foreign country;

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

 

 

B.

Proof of Address (Foreign National)

Authority of attestation

 

For Foreign National residing in his own country which is under Hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Foreign National residing outside his country and that country where he resides is under Hague Convention

Option A- Notarised by the Public Notary of that foreign country; and

Apostilled by the competent authority of that foreign country

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

For Foreign National residing in his own country which is under common wealth country

Notarised by the Public Notary

 

For Foreign National residing outside his country and that country where he resides is under common wealth country

Option A- Notarised by the Public Notary of that foreign country;

Or

Option B - Attested by Embassy of his country of origin at place where he resides

 

For Foreign National who is from a country which is outside the Commonwealth and also not a party to the Hague Apostille Convention, 1961

1. Notarised before the Notary (Public) of such country; and

2. The certificate of the Notary (Public) shall be authenticated by a Diplomatic or Consular Officer

 

Particulars

 

Subscriber docs

Mandatory:

Certificate of Incorporation or such proof

Moa and Aoa

Board Resolution

Declaration from the foreign subscriber(s) in respect of not having PAN

Any one of the following:

Bank Statement

Electricity Bill

Telephone Bill

Mobile Bill

 

For Registered Office premises

 

Mandatory- any one

Rent agreement

Lease Agreement

Ownership deed

 

Mandatory

NOC from Landlord

Mandatory- Any one utility bill in name of owner (not older than 2 months)

Electricity Bill

Telephone Bill

Water Bill

Municipal Charges bill

Documents required for Non Individual Subscriber

Procedure for attestation of documents:

 

In case, the director is residing outside India, then the attached supporting documents should be attested by the Consulate of the Indian Embassy, Foreign public notary.

 

 

 

A.

Proof of Identity-Passport/PAN Card

Authority of attestation

 

For Indian National (Non-Resident)-who is residing in country which is part of Commonwealth countries

Attested by India Embassy

 

For Indian National (Non-Resident)-who is residing in country which is part of Hague countries

Attested by India Embassy

 

For Indian National (Non-Resident)-who is residing in a country outside the Commonwealth and which is not a party to the Hague Apostille Convention, 1961

Attested by India Embassy

 

 

 

B

Proof of Address for Indian Citizen (RI or NRI)

Authority of attestation

 

For Indian National (Non-Resident)-Permanent address in India

Any professional CA/CS or CMA (Practising)

 

For Indian National (Non-Resident)-Present address at overseas - which is a country under Common Wealth countries

Notarised by Public Notary

 

For Indian National (Non-Resident)-Present address at overseas - which is a country under hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Indian National (Non-Resident) - Present address at overseas - -who is residing in a country outside the Commonwealth and which is not a party to the Hague Apostille Convention, 1961

1. Notarised before the Notary (Public) of such country; and

2. The certificate of the Notary (Public) shall be authenticated by a Diplomatic or Consular Officer

For Registered Office Premises

Procedure for attestation of documents:

 

In case, the director is residing outside India, then the attached supporting documents should be attested by the Consulate of the Indian Embassy, Foreign public notary.

 

 

 

A.

Proof of Identity-Passport/PAN Card

Authority of attestation

 

For Indian National (Non-Resident)-who is residing in country which is part of Commonwealth countries

Attested by India Embassy

 

For Indian National (Non-Resident)-who is residing in country which is part of Hague countries

Attested by India Embassy

 

For Indian National (Non-Resident)-who is residing in a country outside the Commonwealth and which is not a party to the Hague Apostille Convention, 1961

Attested by India Embassy

 

 

 

B

Proof of Address for Indian Citizen (RI or NRI)

Authority of attestation

 

For Indian National (Non-Resident)-Permanent address in India

Any professional CA/CS or CMA (Practising)

 

For Indian National (Non-Resident)-Present address at overseas - which is a country under Common Wealth countries

Notarised by Public Notary

 

For Indian National (Non-Resident)-Present address at overseas - which is a country under hague Convention

1. Notarised by the Public Notary of that foreign country; and

2. Apostilled by the competent authority of that foreign country

 

For Indian National (Non-Resident) - Present address at overseas - -who is residing in a country outside the Commonwealth and which is not a party to the Hague Apostille Convention, 1961

1. Notarised before the Notary (Public) of such country; and

2. The certificate of the Notary (Public) shall be authenticated by a Diplomatic or Consular Officer

Who is an NRI?

As per RBI- A ‘Non-resident Indian’ (NRI) is a person resident outside India who is a citizen of India.

As per Income Tax Act, 1961 "non-resident" means a person who is not a "resident", and for the purposes of sections 92, 93 and 168, includes a person who is not ordinarily resident within the meaning of clause (6) of section 6 ;

The word “person" includes—

(i) an individual,

(ii) a Hindu undivided family,

(iii) a company,

(iv) a firm,

(v) an association of persons or a body of individuals, whether incorporated or not,

(vi) a local authority, and

(vii) every artificial juridical person, not falling within any of the preceding sub-clauses.

Explanation.—For the purposes of this clause, an association of persons or a body of individuals or a local authority or an artificial juridical person shall be deemed to be a person, whether or not such person or body or authority or juridical person was formed or established or incorporated with the object of deriving income, profits or gains;

How To Determine That An Individual Is NRI?

'Non-resident Indian' is an individual who is a citizen of India or a person of Indian origin and who is not a resident of India. Thus, in order to determine whether an Individual is a non-resident Indian or not, his residential status is required to be determined under Section 6. As per section 6 of the Income-tax Act, an individual is said to be non-resident in India if he is not a resident in India and an individual is deemed to be resident in India in any previous year if he satisfies any of the following conditions:

1. If he is in India for a period of 182 days or more during the previous year; or

2. If he is in India for a period of 60 days or more during the previous year and 365 days or more during 4 years immediately preceding the previous year.

However, in respect of an Indian citizen and a person of Indian origin who visits India during the year, the period of 60 days as mentioned in (2) above shall be substituted with 182 days. The similar concession is provided to the Indian citizen who leaves India in any previous year as a crew member or for the purpose of employment outside India.

The Finance Act, 2020, w.e.f., Assessment Year 2021-22 has amended the above exception to provide that the period of 60 days as mentioned in (2) above shall be substituted with 120 days, if an Indian citizen or a person of Indian origin whose total income, other than income from foreign sources, exceeds Rs. 15 lakhs during the previous year. Income from foreign sources means income which accrues or arises outside India (except income derived from a business controlled in or a profession set up in India).

An Indian citizen shall be deemed to be resident in India only if his total income, other than income from foreign sources, exceeds Rs. 15 lakhs during the previous year. For this provision, income from foreign sources means income which accrues or arises outside India (except income derived from a business controlled in or a profession set up in India).

However, such individual shall be deemed to be Indian resident only when he is not liable to tax in any country or jurisdiction by reason of his domicile or residence or any other criteria of similar nature.

Thus, from Assessment Year 2021-22, an Indian Citizen earning total income in excess of Rs. 15 lakhs (other than from foreign sources) shall be deemed to be resident in India if he is not liable to pay tax in any country.

A person shall be deemed to be of Indian origin if he, or either of his parents or any of his grand-parents, was born in undivided India.

6. For the purposes of this Act,—

(1) An individual is said to be resident in India in any previous year, if he—

(a) is in India in that year for a period or periods amounting in all to one hundred and eighty-two days or more ; or

(b) [***]

(c) having within the four years preceding that year been in India for a period or periods amounting in all to three hundred and sixty-five days or more, is in India for a period or periods amounting in all to sixty days or more in that year.

Explanation 1.—In the case of an individual,—

(a) being a citizen of India, who leaves India in any previous year as a member of the crew of an Indian ship as defined in clause (18) of section 3 of the Merchant Shipping Act, 1958 (44 of 1958), or for the purposes of employment outside India, the provisions of sub-clause (c) shall apply in relation to that year as if for the words "sixty days", occurring therein, the words "one hundred and eighty-two days" had been substituted ;

(b) being a citizen of India, or a person of Indian origin within the meaning of Explanation to clause (e) of section 115C, who, being outside India, comes on a visit to India in any previous year, the provisions of sub-clause (c) shall apply in relation to that year as if for the words "sixty days", occurring therein, the words "one hundred and eighty-two days" had been substituted 30[and in case of 31[such person] having total income, other than the income from foreign sources, exceeding fifteen lakh rupees during the previous year, for the words "sixty days" occurring therein, the words "one hundred and twenty days" had been substituted.]

Explanation 2.—For the purposes of this clause, in the case of an individual, being a citizen of India and a member of the crew of a foreign bound ship leaving India, the period or periods of stay in India shall, in respect of such voyage, be determined in the manner and subject to such conditions as may be prescribed.32

33[(1A) Notwithstanding anything contained in clause (1), an individual, being a citizen of India, having total income, other than the income from foreign sources, exceeding fifteen lakh rupees during the previous year shall be deemed to be resident in India in that previous year, if he is not liable to tax in any other country or territory by reason of his domicile or residence or any other criteria of similar nature.]

A Hindu undivided family, firm or other association of persons is said to be resident in India in any previous year in every case except where during that year the control and management of its affairs is situated wholly outside India.

A company is said to be a resident in India in any previous year, if—

(i) it is an Indian company; or

(ii) its place of effective management, in that year, is in India.

Explanation- For the purposes of this clause "place of effective management" means a place where key management and commercial decisions that are necessary for the

conduct of business of an entity as a whole are, in substance made.

Every other person is said to be resident in India in any previous year in every case, except where during that year the control and management of his affairs is situated wholly outside India.

Not Ordinarily Resident

A person is said to be "not ordinarily resident" in India in any previous year if such person is—

(a) an individual who has been a non-resident in India in nine out of the ten previous years preceding that year, or has during the seven previous years preceding that year been in India for a period of, or periods amounting in all to, seven hundred and twenty-nine days or less; or

(b) a Hindu undivided family whose manager has been a non-resident in India in nine out of the ten previous years preceding that year, or has during the seven previous years preceding that year been in India for a period of, or periods amounting in all to, seven hundred and twenty-nine days or less 35[; or

(c) a citizen of India, or a person of Indian origin, having total income, other than the income from foreign sources, exceeding fifteen lakh rupees during the previous year, as referred to in clause (b) of Explanation1 to clause (1), who has been in India for a period or periods amounting in all to one hundred and twenty days or more but less than one hundred and eighty-two days; or

(d) a citizen of India who is deemed to be resident in India under clause (1A).

Explanation- For the purposes of this section, the expression "income from foreign sources" means income which accrues or arises outside India (except income derived from a business controlled in or a profession set up in India) and which is not deemed to accrue or arise in India.