Private Limited Company

Private Limited company is a company which is formed with minimum of 2 members and limited to 200 members. Here, transfer of shares is restricted and invitation to public for subscription to shares is prohibited. A private company can only accept deposits from its members up to a particular limit.

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Advantages and Requirements

Advantages of getting registered as Private Limited company

Limited liability protection to the members of the company.
Stability and perpetual succession as the company continues to exist irrespective of exit of members.
Better credibility is created for obtaining funds from investors.
Easy to raise loans from financial institutions.
Easy to get credit from suppliers.
Management and ownership separation is created which helps in better decision making for success of the business.

Requirements to register and documents required

Minimum 2 members
Minimum 2 Directors and their details like names, address, PAN, identity proofs etc.
One of the Directors must be an Indian Resident
DSC (Digital Signature Certificate) of all directors
In case of rental property- Rental agreement, NOC from the owner of the property, proof of address, and copy of utility bills
In case of own property- proof of ownership

Types of Private Companies

Company Limited by Shares

For a company limited by shares, the liability of the members is limited by the Memorandum of Association to the nominal amount of his/her share or so much which remains unpaid. Therefore, the liability of the shareholder with respect to a Private Limited Company limited by shares is restricted to the paid-up share capital or any amount that remains unpaid. The shareholder cannot be held liable or asked to pay more than his/her share capital invested in the company.

Company Limited by Guarantee

In a Private Limited Company – limited by guarantee, the liability of the members is limited to the amount of liability undertaken by each of the members in the Memorandum of Association. Therefore, the members of a Private Limited Company – Limited by Guarantee cannot be held liable for an amount higher the amount of guarantee undertaken by the member in the Memorandum of Association. A private limited company – limited by guarantee is suitable for clubs, trade associations, societies and for entities that require very minimal capital or working capital funds.

Unlimited Companies

Unlimited companies are those types of company that do not have any limit on the liability of its members. The liability of each of the members extends to the whole amount of the company’s debts and liabilities. Therefore, the creditors of an unlimited company have the ability to enforce the debt and liability of the company on the shareholders, if wound-up. Despite not giving the shareholders limited liability protection, an unlimited company is still considered to be a separate legal entity. Therefore, the members of an unlimited company cannot be sued individually.

Steps to Register

Company incorporation can be done through online filing of SPICe+ form.

The SPICe form was an e-form for incorporation of company, whereas the SPICe Plus form is an integrated web form that can be utilised for multiple services.

The form is divided into two parts:

SPICe+ Part A

This part of the form is for applying for Name Reservation for a company

SPICe+ Part B

The SPICe+ application form

Part A of the form

Part B of the form

Private Limited Company

Get in touch with us

Advantages and Requirements

Advantages of getting registered as Private Limited company

Requirements to register and documents required

Types of Private Companies

Steps to Register

Setting up business

ROC Compliance

Direct tax compliance

Indirect tax compliance