Documents Required for Company Registration

Setting up a firm or a corporation in India necessitates that the founders or directors remain involved in the “legal game.” The first and most crucial step in establishing a business is to gather all the paperwork necessary for company registration in India. Any errors in the paperwork required for new business registration in India would render all efforts futile. Several legal requirements must be completed to register a business.

This article encloses a list of all the essential documents required for company registration. However, before jumping onto that, let's find out what a company is, its different types, and the need to register a company.

What is a company?

A company is a legal organisation created to engage in and manage a commercial or industrial operation. Depending on the corporate legislation of its country, a business can be formed in a variety of ways for tax and financial responsibility purposes.

The company's area of operation will typically dictate the business structure it selects, such as a partnership, sole proprietorship, or corporation. These structures also represent the company's ownership structure.

Different types of companies

There are three major types of companies or businesses, which include:

• Private business
• Public businesses
• One-person business

Ownership structures, laws, and financial reporting requirements differ between the three.

Why do we even need to register a company?

In India, it is not mandatory to register a company when it is started. However, keeping in mind the importance and the benefits of registering a company, one should always try to follow the necessary procedure to avoid any complications afterwards.

Some of the benefits of registering a company include:

1. The Legal Entity

The company becomes a legal entity once it is registered. It possesses certain rights, is responsible for its obligations, and manages its legal processes. A company's personality develops after incorporation. It has a broader legal capacity since a company can possess property and incur obligations; as a result, individual members of the company are not liable to the business's creditors for debts.

2. Perpetual Succession

The term "perpetual succession" refers to the company's ability to continue or endure indefinitely. It indicates the continued existence of a corporation or firm until it is officially disbanded. Perpetual succession is a significant consideration.

3. Limited Liability Corporation

Restricted liability is a legal obligation to repay a limited number of debts.

4. Shares are freely and easily transferable

The number of shares in a corporation is limited by the number of shares acquired. It can be transferred to another individual by a shareholder. Claims can be transferred to whoever the shareholder wishes. The buyer of shares would be given a signed copy of the share transfer form and share certification. There are no technical limitations on the transfer of shares in a public limited corporation.

5. Aids in the generation of capital

A corporation can receive money in two ways, which include equity that involves soliciting cash from the public, and debt that refers to bank loans or other types of credit. When a firm is established, it is regarded as more dependable, making it easier to get financing.

6. Expertise and efficiency are the two Es

Due to the separation of management and ownership, specialists in the area can be assigned to each position in the firm. As a result, accountability improves. The availability of resources makes it possible to offer competitive pay packages and recruit the top personnel in the market.

So, we've seen enough benefits and reasons why we should register a company when started.

Why should you be careful while registering your company?

The Registrar of Companies (RoC) is quite particular about the papers supplied during the online business registration procedure. For example, suppose an applicant provides voter ID and passport as identification documents, and there are any inconsistencies in the names on both. In that case, the application may be denied or require re-submission, which may cause the process to be delayed for a few days. Even minor inaccuracies are not tolerated.

Documents required for company registration

Now that you understand the significance and benefits of company formation, it is always better to get expert help who can take you through the process and the advantages and disadvantages of each registration. According to the Companies Act 2013, company registration in India is done through the MCA/RoC.

The following papers must be supplied by the company's directors and shareholders (Indian nationals)

Xeroxed reproductions of:

1. PAN

2. Government ID evidence - Voter ID, passport, or driving license

3. Account statement

4. Utility bills (mobile, gas, or electricity)

5. Photograph in passport size

6. Specimen signature - The signature of the director on a blank document

It should be noted that the first three documents should be self-attested by any of the directors.

The following papers must be supplied by the company's directors and shareholders (NRIs)

Xeroxed reproductions of:

1. PAN

2. Identification documents such as a voter ID, passport, or driving license

3. The most recent bank statement

4. The most recent utility bills, such as phone, mobile, or energy bills

5. Photograph in passport size

6. Signature of the specimen (blank document with the signature [directors only])

The following papers must be supplied by the Company's directors and shareholders (NRIs)

Xeroxed reproductions of:

1. Identification document

2. Voter identification/license/passport driver's

3. The most recent bank statement

4. The most recent utility bills, such as phone, mobile, or energy bills

5. Photograph in passport size

6. Signature of the specimen (blank document with the signature [directors only])

Note: All paperwork must be notarised (if NRI is currently in India or a commonwealth country). All papers must be notarised, apostille-ed, or certified by the Indian embassy (if in a non-commonwealth country).

Proofs of office location.

Xeroxed reproductions of:

1. The most recent water or power bill

2. English rental agreement notarised

3. Receipt of the most recent rent

4. In the case of privately owned property, a sale deed or property deed

5. A letter of authorisation from the property owner

Remember the following:

• Name on the PAN: As the PAN is crucial and requires documentation for the whole business registration process and subsequent legal processes such as submitting taxes and compliances, the applicant must confirm the name on the PAN is proper. Before submitting the papers, any changes in spelling or other abnormalities caused by spelling mistakes must be corrected. The name on all additional evidence must match the name on the PAN. If they are not the same, adjustments must be made to the others as well.
• Recent utility bills: All utility bills should be no more than three months old. If they are older, the RoC may reject the application arbitrarily.
• NOC: A NOC, or no objection certificate, must be supplied by the property owner on which the company is formed. If a NOC cannot be obtained, any friend might register the firm as it is only a communication address.

Finally, we would like to stress that all the documents mentioned above must be obtained by anybody seeking to establish a company in India. If you do not have any of these documents, you must bring them as soon as possible to expedite the registration procedure. In addition to the documents mentioned above, be ready with INC-9, MOA, and AOA. These legal documents, mainly designed to incorporate a business, must be signed and notarised by the company's promoters.

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FAQs

Q. Is it necessary or compulsory for a company to be registered?

Ans. No, it is not a compulsion. But registering your company brings to you various benefits and a legal entity for the firm, so it always has a side benefit to do so.

Q. Are there any cons to registering a company?

Ans. Some cons to registering a company are:

• Loss of personal ownership
• Difficulty when wanting to dissolve the company
• Problems of double taxation

Q. Is it worth registering a company?

Ans. Yes, it is much more worth it.