COMPANY FORMATION
By sushma gowda
DEFINATION
COMPANY
Company is a legal entity formed to operate a business by the group of individuals. It can be a public or private company. Company is formed to do business activities and to earn profit with it or it can be non-profit.
Before starting a company it requires legal documentations and procedure’s to follow. Company is the artificial legal person different from its members and have its own rights and responsibility.
FORMATION OF COMPANY
During the formation of the company one must consider what kind of Company/firm/Limited Liability Partnership one need to form, and legal obligations goes as per the requirements.
Private companies can be formed by 2 or more person and it can be limited by shares or limited by guarantee.
In case of public company it be formed by 7 or more person.
And in one person company by one person as a private Company.
STAGES OF FORMATION OF COMPANY
1) PROMOTION STAGE:-
Promotion stage where person build enterprises and sum up people who are involved in it.
2) REGISTRATION OF COMPANY
Registration is the Second stage of Formation of company. Where company get registered under companies act 2013with ROC (Register of Company) and after all the compliances they get Certificate of incorporation.
3) COMMENCEMENT OF BUSINESS STAGE
After getting Certificate of incorporation be it a private limited or public limited company one can start a Business.
In case of public company having a share capital need to follow Capital Subscription Stage.
STEPS REQUIRED FOR THE FORMATION OF COMPANY UNDER COMPANIES ACT 2013.
Note:- However Form INC-1 got expired and it has been advised by the government instead to use SPICe (Simplified Proforma for Incorporating Company Electronically) Form.
The person who wanted to be Director of the company must obtain DIN(Director Identification number) by giving application for allotment in Form DIR-3
Articles of Association( AOA) as first director of Company his interest in other company or firm and consent to act as director must be filed in Form DIR-12 along (Registration offices and fees) Rules, 2014
After Incorporation within a period of 30 days should be verified by registrar as per Sec 12(2) of Companies act 2013, any change in registered office should be notified within period of 15 days as with fee as provided in the Companies per Sec 12(4) of Companies Act 2013. In Form INC-22
As per Section 25 of Companies (incorporation) Rules, 2014, it is filed for verification of registered office.
It Deals with incorporation of new company apart from one Person company. It includes documents such as MOA/AOA, Evidence of payment of stamp duty and details of subscriber and director
After getting reservation of name in form INC-1 within 60 days one need to file E-form 7.
After filing all the information and forms with registrar of company. If Roc is satisfied with documents provided they will give Certificate of Incorporation in Form no INC 11 as directed by the rule 18 of Companies (incorporation) Rules, 2014
the specimen signature and latest photograph duly verified by the banker or notary shall be in the prescribed Form No. INC.10.
Declaration form shall be signed by either chartered Accountant, Company secretary or Cost Accountant in practice shall certify.
Registrar will allocate CIN (Certificate of incorporation in India) to the Company after successful incorporation.
If the information submitted while incorporation is false or incorrect or represent suppressing material facts all the person responsible for that will come under Fraud Under Section 447 such as Promoter, First Director etc.. After such disagreement NCLT will make follow order
Before Passing reasonable opportunity of being heard must be given.
One can download forms from www.mca.com
