There are several issues may come why a director need to be fired, if a director engages in illegal activity, fraud, bankruptcy or some other wrongdoing, the company can remove or change the director for the cause.
Out of them just in below paragraph we have given a hint that can leads to change of a director and in this post you will get a brief information on legal process to add or remove a director in a company.
Every company has ups and down. If your business is always in growing position then you are performing well and this credit goes to management team and next to the director. And if it is going down gradually by mistakenly, surely many issues will come on the business and everyone’s eye will be focus to director what he is doing.
If he is not responding at all and not taking any concrete solution to business, company can take action on him/her and think about for option B, it may be replacement of that post.
So that's why, we prepared this post simple and concise to read, understand and acquired knowledge on how to change or add/remove a director in a company with respect to the company necessity.
Here we have given a real time example on this topic for better understanding and clear vision that helps you to know the logic behind it.
Scenario Based Example:
A client came to us and asks we want to change our director, so please tell us what are the legal formalities belongs to it.
As we are legal consultants, we should know the cause of replacement of director. Why they are so insisted to remove that director and what is the cause behind it? We asked the same thing to them why you want to change that director and did he made anything mistake. See what they said as their statement:
1. He got found bankruptcy
2. Not attending the office meeting
3. Not taking solid solution for company growth
3. Now he is becoming unsound mind
4. Pre-occupation in other/family business
5. Showing health issue
Just like any other legal procedure in India there are definite rules and regulations that have to be followed while changing the director or designated partner of a company. One of them is that you need proper legal papers in order to make such changes; there has to be a board resolution for the same; and the proper forms need to be filed the right way with the Registrar of Companies (ROC) in your state.
The appointment of directors
In India, directors are selected in a company by its Board of directors and in some cases the Shareholders. Their main task is to manage the company. The Companies Law of 2013 deals with this.
It states that there should be at least two directors in a private limited company and in a limited company there should be a minimum of three directors. When it comes to a limited liability partnership (LLP) there are designated partners. As per the Limited Liability Partnership Act, 2008 there should be at least two designated partners in a company. There could be several reasons as to why these companies may feel the need to appoint or remove directors.
Adding and Removing Directors
Procedure/Steps for Changing Director in a Company
Here we just simplified the procedure into certain steps to change the director of a company. I think you will be easy with this process for a quick hack and will get a brief explanation from the below steps.
Appointment of Additional Director
1. Obtain DSC (Digital Signature Certificate) for Director
2. Obtain DIN (Director Identification Number) for Director
3. Drafting of resolution for Board Meeting, letter of Appointment on issue of adding Director in a Company
4. Appointment of additional director has to be confirmed in upcoming EGM/AGM.
5. File eForm DIR-12 within 30 days from passing a Board Resolution towards Registrar of Companies certificate by Company Secretary/Chartered Accountant/Cost Accountant in practice.
6. It will be updated in the master data once we file the form.
Procedure for Removal of Director
For the removal of director in a company, the same process have to carry out as mentioned above in appointment of additional director process, but you have to leave step.1 and step.2 which is not required at all and follow the other remaining steps.
Once again we mentioned the steps below here for your better clarification and understanding
1. Removal of Director, by passing a Board Resolution.
2. File eform-DIR-12 within 30 days from passing a Board Resolution towards Registrar of Companies certificate by Company secretary/Chartered accountant/Cost accountant in practice.
3. It will be updated in the master data once we file the form.
The first thing that you need in order to add either one of the two designations being talked about over here is a digital signature.
Once you get the digital signature a director or designated partner could be added to the company. In case of a director the consent of shareholders is needed as well. As far as removing them is concerned, the first thing that needs to be ensured is that even after the removal there would be the requisite number of designated partners or directors in that company. After that the company in question needs to make sure that there is a proper resignation letter submitted with the form that needs to be filled up for the resignation to take effect.
As such the process of changing these office bearers, no matter how important they are, is not that a major one as such. In order to become the director of a company you need to be at least 18 years old and you should have a director identification number (DIN) as well. The nationality of the person is not really that important over here – she or he could be an Indian national or a foreign national as well.
Normally in order to remove a director a company needs to wait till its annual general meeting where it can pass an ordinary resolution to the effect.
However, such decisions can be taken in an extraordinary general meeting as well. You need a simple majority in order to pass the ordinary resolution to remove the director. After the resolution has been passed the company has to file the same alongwith forms that are necessary for the purpose with the union ministry of corporate affairs of India. In fact, these days, such work can even be done by chartered accountants (CAs) as well. Apart from that there are plenty of companies that are willing to provide useful services in this regard.
Read Related Posts:
The rules and regulations regarding changing the registered office according to the Companies Act 2013 are stated in Section 12 of the Companies Act 2013. Over there it is stated that a company should have a registered office at least from the 15th day of being an incorporated entity. This is necessary so that it can receive all the notices and other communication that are addressed to it. It is also important for a company to submit verification of the registered office within 30 days of being incorporated to the ROC of companies (ROC). It also states that in case there is a change in the office’s location the ROC needs to be notified within 15 days of the change.
The company in question needs to use Form INC-22 in order to notify the ROC of companies regarding the changes. The Indian government has in Companies Rules 2014 prescribed a couple of rules – 25 and 27 – so that the new location of the company’s registered office can be verified properly.
Rule 27 deals with verification and notice of the change of the situation of a registered office of a company. It states that apart from having to file Form INC-22 to notify the ROC about the change within 15 days of having made the same, a certain amount of fees has to be attached to the form as well.
Sub section 2 of Section 12 of this rule mentions the documents that have to be attached with the application as well as the manner in which it needs to be done. The documents that have to be attached should provide information regarding the office’s location at the time when it was incorporated along with any and every change in the same. The documents that have to be provided for verifying the change in registered office address normally depend on the ownership status of the property in question.
If the company itself owns the registered office it would have to provide the conveyance deed of the property in question. It is also important for the deed to be in the name of the company itself. If the company has rented or leased the property it would have to furnish the rent agreement or lease deed. In case, it is a rented property it would have to show the rental receipts as well. It is very important that the rent receipt is not older than by a month.
If the premises have not been leased by the company and if the director or any other individual owns them the company would have to show the proof that it has the permission necessary to operate from that particular location. It could be done in the shape of a no objection certificate by the owner. It would also have to furnish copies of utility bills such as mobile phone bill, electricity bill, telephone bill, and gas bill. It is very important that these bills are in the name of the company itself and they should also have the address that is being used by the company as its registered address.
It is also important that they are not more than two months old. It is also important for the company to pass certain resolutions such as board resolution and special resolution in this regard. The special resolution has to be passed at a general meeting in case the registered office is being shifted to a place that is outside the local lists in that city, village, or town, where the office is located at present. The board resolution needs to be passed so that the director can be authorized to sign and then submit the Form INC-22.
Changing the registered office to a different ROC but in the same state
If the company is looking to amend its registered office from the jurisdiction of one ROC to another it needs to apply in order to receive the permission to do so from the regional director (RD). This has to be done exactly the way it has been stated in Form INC-23. After the RD allows this change to happen it has to file with the ROC within a period of 60 days so that it can get confirmation from there as well.
Normally the ROC confirms the change within 30 days of having filed for the same.
Changing the registered office to another state
If the company wants to change its registered office to another state then it would have to change its memorandum of association (MOA) for that. The company has to pass a particular declaration in order to alter the MOA. Within 30 days of passing the resolution it would have to file the same in the Form MGT-14 with the concerned ROC. The company also needs to file Form INC-23 with the CG in order to get the approval necessary to change its registered office from one state to another.
For this it needs to attach documents such as a copy of the special resolution that sanctions the alteration – it should be passed by the company’s members; a copy of the MOA and the articles of association (AOA); a copy of the notice that conveys the general meeting with a proper descriptive statement; a copy of the minutes of the general meeting where the resolution that permitted this change was taken; a list of debenture holders and creditors; a copy of power of attorney or board resolution; and documents related to paying the application fee.
Within 60 days of making the application the central government will give its nod to the change and make it happen. However, before it does that the government will also find out if this is being done in accordance with the wishes of the debenture holders and creditors. After the Indian government provides its approval the company shall file it with the ROCs in both the states where the new and the old registered offices are. The ROC of the new office location would register the same and provide the applicant a new certificate of incorporation.
We all know that India is heading towards the business hub where it stood amongst the top 5 countries in the world in terms of startups; so startups scenarios are increasing day by day since from 2014 and they are building the Startup Ecosystem stronger than strong. India is creating a better platform for budding entrepreneurs’ as well as nation’s growth and development.
As per NASSCOM’s report, India will be the homes of 10,500 startups by 2020, so more than 65 percent of startups are already incorporated in various cities like Bengaluru, Delhi NCR, Mumbai, Hyderabad, Ahmedabad, Chennai, Pune and Jaipur as on 2017. A creative thinker can be a part of this to go ahead of his/her career by passion and innovative thought. And apart from this, import or export business is in race with this sector.
Before you jumping towards the import export business, you should cultivate about it properly, see the horizon and go through the deep thought and think about it, really do have I the experience, skill and talent to give the new direction to my business towards the land of new opportunity? Yes, of course, I am the right person to carry out the business into my goal.
What is Import Export Code (IEC)?
Importer Exporter Code is shortly called as IEC is allotted to a person or businesses owners for importing goods/products into or exporting goods/products from India. It is a must required license for an every organization where those are going to start an import export business in India.
Import Export Code is a code which consists of 10 digits of alphanumerical numbers granted by the joint DGFT (Director General of Foreign Trade) office of India under the Ministry of Commerce and Industry to the authorized business entity/person/company for carrying out the import export business in Bangalore Karnataka or any cities in India or abroad. This is the first legal proof to run your business smoothly under the loving governance of legal department.
Features of Import Exports Code Registration
When you get registered your import/export business, you will get benefits from DGFT, Customs, Excise, Export Promotion Council, Foreign Trade Policy and etc. and here you can follow below the following important features and benefits of IEC (Import Export Code).
What are the opportunities that you have in export and import business in India?
As such imports and exports form an integral part of the country’s economy and this means that as a budding entrepreneur in this particular domain there are plenty of opportunities waiting at your doorstep. No country in the world can exist without interacting with other countries of the world and import and export form an important part of said interaction. As and when you get into this business there are plenty of opportunities that you can explore.
Looking at the online marketplaces
These days, there are plenty of online sellers such as Amazon, Alibaba, Allexpress, and DHGate to name a few. Here on these sites, as an exporter and importer, you can get listed as a vendor, and then you would be connected to buyers around the world. In this case, the internet would be playing the role of a bridge. This way, you would be exporting your products to your customers who may be thousands of km away from you. This would also open up the international markets to you.
Way to Starting an Importer or Exporter Business
The first step that you need to take in order to start an import export business in India is to have a proper business set up. You should ideally start a sole proprietorship and for this you can get a VAT (value added tax) registration or get registered for service tax as well. You should also have a name and a logo for your business. And after this, you need to follow the certain steps to land your business in a perfect way such as
1. Getting PAN for your business
2. Starting a Current Bank Account in the name of your business
3. Getting Import Export Code from DGFT department
4. Getting RCMC from export promotion councils
Here the steps are summarized below to start an importer or exporter business in Bangalore Karnataka or any other cities in India.
1. Getting a PAN (permanent account number) card for your business
Once you have received the abovementioned registration you should get a PAN card for your business from the income tax department. This is mandatory.
2. Starting a current account
Once you get your business registration followed by the PAN card you would have to start a current bank account. You would need to open this account at a commercial bank. It would be done solely for business purposes.
3. Getting the import export code
The next step in this regard would be to get the import export code (IEC). As far as opening an import and export business in India is concerned this happens to be one of the most important requirements. In fact, you would need the IEC in almost every case with the exception of prohibited and restricted services and goods.
In order to get the IEC you would have to apply straightaway at the website of DGFT (Directorate General of Foreign Trade) wherein we explained it thoroughly below in “how to apply IEC online” para. The documents that you need to provide in order to get the IEC are your personal PAN card or the one that you are using for your company, your photograph, and a copy of a cancelled check from the current account that you are presently maintaining for your business. You should remember in this context that it is mandatory to have a PAN card in order to get this code and you will get only one code for each PAN card.
4. Getting the RCMC
Once you get the IEC you would have to get the RCMC (registration cum membership certificate). These are provided by the export promotion councils. They help you get authorized for imports and exports as well as all other kinds of benefits. India has almost 26 export promotion councils that can provide you an RCMC. Once you have got the RCMC and IEC you would be able to start your export and import business from India as well. The IEC and RCMC are accepted in all businesses and their branches across the country.
Normally, it takes around 5 to 7 days to get all the registrations out of the way.
How to Apply IEC Online
To apply for IEC (Import/Export Code) in Bangalore Karnataka or any other cities of India we must follow the procedure and nowadays all the application process are occurred in online; so, it depends on your regional authorities (RA) area where you want to obtain your importer exporter code (IEC) number. By applying through the proper requisite; then you must have to go for online and log on to the Directorate General of Foreign Trade portal http://dgft.gov.in; which comes under the Ministry of Commerce and Industry, Government of India and ready to apply IEC online in India.
Here we explained briefly the application procedure of obtaining import export code in India, have a look on it and get an overall idea about IEC registration in Bangalore, Karnataka or any other cities in India and get your IEC Number from the specific joint regional directorate foreign trade department.
Now we are taking you to the online application process of IEC, when you visit the above mentioned site you can find a Menu Bar on top of the site which carries various menus but go for “Online Application” menu Tab, or you can directly go to Quick Links; below that you will find Importer Exporter Code (IEC) through this you can apply also then see the below steps for the process of import export code registration.
Setp-1: Visit to dgft.gov.in site; go for “Importer Exporter Code (IEC)” link below the Quick Links then click on “Online IEC Application” option for fresh application.
Step-2: When you click on the “Online IEC Application”, it is promptly landed to the “Login for IEC Online” page with displaying Enter Your PAN box.
Enter your or company PAN number and click to NEXT button. Then it will display MOBILE and EMAIL ID box in addition to your given PAN number. You have to fill that Mobile Number and Email Id box and click on GENERATE TOKEN button verifying with the captcha code.
After clicking on GENERATE TOKEN button, in same dialog box you will find “Mobile Token” and “Email Token” blank field and a message has already came to your given Mobile Number and Email ID bearing with Mobile Token and Email Token. You have to fill this two box and click on the SUBMIT button with verifying the captcha.
Step-3: After clicking on SUBMIT button, you will be directed to Importer Exporter Code (e-IEC) window and here you see the left side bar of the window and click on IEC Master and fill the Fresh IEC Application form with required data. And submit it.
Step-4: Go for side bar and click on the Branch menu that just down to IEC Master. Fill the form if you have any branches, otherwise you can leave it.
Step-5: In step five, click on Director Link from side bar and fill all the data regarding to Proprietor/ Designated Partner/ Director of the company and submit it.
Step-6: Click on Appl. Fee link from same side bar and make a payment here of Rs. 500 online.
Step-7: Click on Verify Fee link from same side bar, if your payment is done it will be verified automatically.
Step-8: Click on Attachments link and here you will have to attach Photo in GIF format, PAN card and Cancelled Cheque in PDF format.
Step-9: Click on Checklist link and it will show a list of information that you have to choose Yes or No option according to your uploaded information.
Step-10: Click on Preview link to check what information you have given here and it will display all your given data in ANF-2A form.
Step-11: In step eleven, click on Print Appl. link and take the physical copy of application; in which this will have to submit in your Regional Director General of Foreign Trade department office. for further use
Step-12: Click on Submit (Dig. Sig) link, here you must required a Digital Signature to proof the identification of the applicant.
Step-13: Last step is Appl. Status; here you can check the progress of your IEC application status. By verifying your
Documents required for import export code registration
For a smooth and continuous registration process, keep the following documents details in your hand and be ready
After completion of all your process you will get your IEC certificate by speed post or courier from the department of DGFT within 3 to 7 days.
There are several reasons as to why the name of a private limited company could be changed. Most of the times, these names are changed because of business-related purposes. It could also be that a private limited company is attempting to rebrand with a new name or maybe it is trying to indicate that there has been a change in its management with the new name.
No matter what the objective is, a private limited company can change its name but for this at it needs, at the very least, the approval of its shareholders. Apart from that such a company also needs to get necessary permission in this regard from MCA (Ministry of Corporate Affairs). It also needs to be noted in this regard that the name change of a private limited company does not have any effect as such on its existence as a legal entity.
So before you change your company name, you need to follow the process that holds all the key points and prospects which carry out the whole process for changing the company name. Here are the following steps to lift up your spirit for name change.
1. Hold Board Meeting and Pass Board Resolution for Name Change
2. File INC-1 to MCA for Name Change Availability
3. Pass Special Resolution in EGM for Name Change and File MGT-14
4. Application to ROC for Name Changing in INC-24
5. If ROC satisfied with your application, then Registrar will issue a new Incorporation Certificate in INC-25
6. Make Changes in Company MOA and AOA
Shortly, we explained here below the name changing process of a company where you can gather the overall idea for your knowledge base.
1. Passing a board resolution
The first step that you need to take in order to change the name of your private limited company is to take a resolution regarding that effect at the board of directors’ level. For decisions such as these a board meeting has to be called so that a resolution to change the name of the company could be passed. At the same meeting a director needs to be given the necessary authority to apply to MCA. This is done to check whether the proposed new name is available or not. The same board meeting can also be used to take a decision in order to call an extraordinary general meeting, where the name of the company would be changed and alterations would be made to the MOA (memorandum of association) and AOA (articles of association).
2. Checking if the name of a company is available or not
Once a company passes a resolution whereby the proposed new name is said to be available the director, who has been authorized to do so, can apply to MCA in order to procure said name. The procedure that is followed over here is the same as the one, which is followed when a private limited company is incorporated.
This means that the new name must be decided on according to the guidelines that have been set in the naming guidelines of the Companies Act, 2013.
3. Passing a special resolution to change the name of a company
As soon as approval for the name can be procured from MCA the company needs to organize an extraordinary general meeting yet again. This needs to be done in order to pass a special resolution in order to change the name of a company. In this meeting some necessary changes also need to be made to MOA and AOA as well.
4. Application for approving the name change of a company
Once a company has passed a special resolution in order to change its name it must file an application with the Registrar of Companies whereby it seeks approval for changing its name. This application needs to be made in Form 1B and the necessary fee needs to be paid along with it as well.
5. Issuing a new certificate of incorporation
Upon being satisfied with the application for changing the name of the company the Registrar of Companies will issue a fresh certificate of incorporation. When this certificate is issued it can be said for sure that the process of name change is finally complete.
6. Making changes to the AOA and MOA
After the new certificate of incorporation has been issued steps have to be taken so that the new name could be incorporated properly in each and every copy of MOA and AOA.
Also Read More:
As far as India is concerned there are certain rules and regulations for choosing the name of a company. They have been mentioned in the draft rules under the Companies Act, 2013. These guidelines are applicable for different kinds of companies in India such as private limited companies, limited companies, and one person companies. The Act states pretty clearly that the name has to be approved so that a new company can be incorporated. Ideally, the name should be a unique one and desirable one.
The proposed name should never be exactly the same as another company
In order to make sure that the name of your company is absolutely unique you need to keep track of a few things.
It should not be the plural version of another company’s name. For example if a company’s name is Vick and you make yours Vicks then it would not be considered sufficiently unique. If you think that you would take another company’s name and tweak its type, spacing, letter case, and punctuation mark, and it would become a unique name you are wrong as well. For example if a company is named Arvind and you name yours ARVIND your name would be rejected for sure. Similarly, if you thought that just joining the words in another company’s name or separating them would be good enough you are wrong yet again. Doing this does not make the name of your company a unique one. This means that the name Bal Ram will not be considered unique enough if a company by the name of Balram exists already.
You might think that by changing the number or tense of the words in a company’s name would give you a unique name but you are wrong as well. It will not make your company’s name a unique one. You might also be under the impression that by changing the phonetic spelling or by using some other spelling variation of a company’s name you would get a unique name for your company. The result of such an effort would not be considered a unique one too. Similarly, if you willingly misspell the name of a company and think that you have got a new name for your company you are wrong as well.
A lot of people may think that by adding or changing the internet extension they would get a new name for their company. That is a wrong thought as well. Similarly, if you thought that by adding a name or a place name to another company’s name you would get a unique name for your company you are wrong too. You will also not be allowed to translate or use various combinations of words present in another company’s name in order to create a name for your own company.
It should not be undesirable
There are certain conditions in which the proposed name of a company is deemed to be undesirable. If the name violates section 3 of the Emblems Act 1950 it would be regarded as an undesirable name. If the proposed name of your company is in contravention of trademark owned by another company then it would be deemed unacceptable as well. Similarly, if a trademark is subject to an 8 application for the purpose of registration it cannot be violated as well. In this case you would need the permission of the applicant or the owner of said trademark.
Your proposed company name would most definitely be deemed inappropriate if it contained offensive words, ones which can hurt the sentiments of any section of people in the country.
Some other conditions to be kept in mind
Your name should ideally be consonant with the main object of your business that you have mentioned in your company’s memorandum of association. If your company is in the financial services industry then the name should indicate that as well. If your name indicates your business constitution such a name would not be passed for sure. The words British India should definitely not be there in your company’s name. If your proposed name shows that you are associated in any way with an embassy, a foreign government, or a consulate it would be disallowed as well.
If your name shows any kind of patronage of a national celebrity or someone who occupies an important place in the government then it would not be allowed to stand. Similarly, abbreviated or vague names would not be allowed. If the proposed name of your company is just the same as one that has been dissolved because of liquidation then it would not be allowed as well. In case, the proposed name of your company is the same as one that has been deleted from record books the name would not be allowed too.
If the name of your company is just the same as that of a limited liability partnership then it would be disallowed as well. In case, the name of your company requires to be approved by a regulator such as IRDA, SEBI, RBI, and MCA then you would have to declare that your name is in accordance with the norms set by the regulator in question. This is mostly applicable for companies looking to work in the financial services sector. If you are a private company the word state would not be allowed in your name. Generic names or ones that include names of other countries would not be allowed in India. In certain cases you would need to get approval from the central government to get the name of your company approved.
Also Read On:
Finance Minister Arun Jaitley presented the Union Budget 2018-19 in Parliament on Thursday. In this budget; they are mainly focused on rural economy and creating opportunity for farmers development, the government is proposed a string of measures for agriculture sector and also announced a new national health insurance scheme where it is said to be the largest progamme in the world funded by the government which will cover 10 crore insurance for poor and marginalized families to 50 crore beneficiaries.
The budget was mostly guided by the mission to strengthen agriculture, rural development, healthcare, education, employment, MSME and infrastructure sectors. As said by the Government, this series of structural reformation will help to drive forward the people and India will be the fastest growing economies country in the world.
Here take an overview of key highlights of Budget 2018-19
At a glance, this budget for the year 2018-19 is largely focused on upliftment of agriculture sector along with major push to healthcare and education sectors in the country.
To know more details about the budget Click Here for Full Report
The Ministry of Corporate Affairs has changed the company incorporation process form 26th Jan, 2018 on the occasion of 69th Republic Day. This is a new step taken by the government of India to make it easier and faster for getting the company name approval with less data based information.
Accordingly, you will have to reserve your company name through the RUN (Reserve Unique Name) service and don't required DSC and DIN; but thing is that you have to choose only one name, there is no option for others. And for each and every name you have to pay Rs. 1000, it may or may not be approve.
They are thinking it will take less time to incorporate a company in India by this easier process. If your company name is approved, it will be kept for 20 days to incorporate the company within that time you have to register your company otherwise it will be invalid but earlier it was 60 days. But one thing we want to clear here as said by the MCA department; the name applied for company may be approved or rejected according to the guideline, you should follow the unique and not resemblance to any other existed business.
If once it is rejected, for every fresh name application you should have to pay the fees infavour of new name suggestion.
Free of Cost Service to all Companies
Here we are giving hint what is free?
You will get free of cost charge only in Company Registration that will be apply for every type of company including Private Limited Company, Limited Liability Partnership (LLP), Public Limited Company, One Person Company (OPC) etc.
So now, the government is waived the company registration charge, means you will not pay for any single money in company registration that you had paid some thousands earlier towards to your company incorporation.
Benefits to Startups
Cost to Bear for Company Registration
But other cost you have to pay related to your company registration
Though the government has waived the fees for company registration final forms, but still there will be some cost which a person will need to bear which are as follows:
Let’s be update for new information on company matters.
The Ministry of Corporate Affairs (MCA) has now made it simpler for you to register your company and limited liability partnership (LLP) from 26 January 2018, which incidentally also happens to be the 69th Republic Day of the country. This can easily be called a giant step of sorts even as the government has rolled out a number of process changes to make it happen. The government is now letting you incorporate your company without any fee. This is part of a new service named Reserve Unique Name (RUN). Now there is no need any longer for you to file a form or even use a DSC (digital signature certificate) as such.
Thanks to this program you would also be able to file the e-form named SPICe without DIN (director identification number). Apart from the fact that the entire process has been made a lot simpler and there is no fee involved in the same the new process takes a lot less time as well.
Now, you can incorporate a company without seeking prior approval for the name or even using the SPICe form as such. And now, we want to inform one thing that the name will be reserved for 20 days as per new rule; however, earlier it was reserved for 60 days and this is a point that they reduced the time period of name reservation for a company to make the business do faster and easier with greater degree of simplifying process. As part of SPICe the incorporation certificate is only provided if MCA approves of the name of the new company.
Now, if you, as an entrepreneur, want to incorporate a company with a name that is unique you can do so for filing directly for incorporation by using the SPICe form. As has been said already, this will help you save plenty of money and time. If an entrepreneur however wishes to incorporate a company that has a name, which is same as that of a company that already exists, an existing trademark, or a current LLP, then they can do so as well but they would need to get the permission of MCA in order to be able to use that name.
What happened before RUN was introduced?
Before RUN (Reserve Unique Name) had been introduced companies had to apply to reserve their names through Form INC-1. At the most they had six choices from which they needed to pick their names. Applicants also needed to furnish at least one DSC and a brace of DINs.
How will the process be now?
Now, thanks to RUN; companies would be able to reserve their names only one in a shorter span of time and with a greater degree of ease process. Even they (entrepreneurs or business owners) would be able receive the name approval before they have received their DSC.
However, the applicant would not be able to opt for more than one name at a time. Right now, companies need to pay INR 1000 for reserving the name of their company using the web form RUN. Each and every time they do this; they would have to pay said amount. It does not really matter if the name has received approval or not. So we suggest that before applying for a name, you may like to be familiar with the Companies (Incorporation) Rules 2014, as amended, and conduct your own Name and Trade Mark search; for which you might not be pay again and again for acquiring the company name.
In order to apply for a name a company would first need to open an account at the MCA website. After that they would have to choose the kind of company that they wish to register and then they would have to provide their chosen name.
After this, they would have to check the name with the database of LLP and company names at the disposal of MCA. It needs to be noted in this context that the MCA database would run a check only to see if a proposed name is exactly identical to a company or LLP that already exists. However, as per the rules and regulations mentioned in the Companies Incorporation Rules, 2014 the proposed name of a company cannot even be similar to an existing one, let alone be an exact replica.
Here we are just showing you an overview of company registration process in present days as related to earlier days and from this you will get a basic knowledge on previous and recent process
Take a look on the new company registration process as on Jan, 2018
1. Get Name Approval from MCA by using RUN service
2. Obtain DSC (Digital Signature Certificate) from any Certifying Authorities (CA)
3. State Stamp Duty Fees
4. Incorporate Company with DIN, PAN & TAN with the help of SPICe e-Form
5. Appointment Directors, CEO, CFO to the Company
Here’s a quick look at earlier company registration process before 2018
1. Obtaining DSC
2. Obtaining DIN
3. Get Name Approval from MCA by filing INC-1 Form
4. Upload Various Forms in MCA using Spice
5. Certain Stamp Duty Fees
6. Company Incorporation Certificate along with PAN and TAN
In India the Indian Partnership Act, 1932 governs the partnership firms. A partnership firm has been defined clearly in Section 4 of the act where a partnership has been said to be the relation between individuals who have consented to sharing the profits accrued from a business. By definition, this essentially must be a business where they are all involved to various extents. Thus, if we go by the above definition, there are five things that should definitely be there in a partnership firm – a contract; the contract should be between at least two people; they should agree to do business together; they should have the common aim of sharing the profits; and they should all be involved in that business.
Contract for a partnership
Any and every partnership happens because there is a contract to that end. It does not happen because of factors such as status, inheritance, or operation of any law as such. This means that in case a partner in such a company passes away his or her daughter and son can definitely lay claim to a certain share in the property owned by that partnership but cannot become a partner immediately. For that she or he needs to enter a similar agreement that her or his deceased parent signed on.
The maximum number of partners in such a company
Normally, the highest number of people that can be there in a company such as this one is 20. A partnership is basically the aftermath of a contract and as such you need a minimum of two people to start one. There is nothing mentioned as such in the Indian Partnership Act, 1932 regarding the highest number of people that can be there in a partnership. However, the Companies Act has stated that you cannot have more than 10 people in case of a banking business and more than 20 in case of all other kinds of businesses.
Advantages of a partnership firm
One of the biggest advantages in a partnership is that the risk factor is always divided since there are plenty of people involved in the same. It is always easier to establish a startup as such since it does not cost you a whole lot of money to start one. Since there are more people pooling in money in a partnership such a firm always has easier access to capital. It is also easier to borrow as a partnership because the capacity is much better.
With a partnership you can easily make a highly skilled employee your partner. There is always the possibility that you would be able to split your earnings. As a result of this a partnership is able to get tax related benefits as well.
How to register a partnership firm?
The first thing that you need to do in this regard is choose a name for your partnership firm. The next step is choosing a partnership deed or agreement. For this you can seek the help of professionals who specialize in work such as this.
The third step that you need to take in order to register a partnership company is to apply for a PAN (permanent account number) card, which will be issued in the name of your partnership firm. Once you get a PAN card, as well as the registered partnership deed, you need to open a current bank account for your partnership company.
There are certain documents that come in handy in cases such as these. The first of them is copy of an address proof cum ID card such as PAN card, Aadhaar card, voter ID card, and driving license of the partners.
Steps are taken for partnership firm registration in India
Here are the key steps we took to register a Partnership Firm in Bangalore, Karnataka or any other cities in India; to accomplish this, you need to follow the below 4 steps:
Accordingly, here we explained briefly the steps of partnership registration; take a look over at this for gathering a little knowledge.
Step-1: Choose a Suitable Name of Your Partnership Firm – The partners have the right to choose a correct name for their business, cause they are the owners of the company and before choosing partnership firm name, they should keep it in mind that the name should not be violate the rules and regulations of Indian Partnership Act, 1932; according to the Section 58. And the name should not be identical to the existing one, otherwise it will be crucial to get name approval from District Registrar of Firms.
Step-2: Draft/Form a Partnership Agreement or Deed with the Help of Experienced Consultants – Partnership Dead/ Agreement/ Contract is a primary legal document which carries the objectives of nature of the business, capital contributed by each partner and their rights, roles, responsibilities and obligations to the firm, Managing Partner, registered office address, and etc.
To produce a partnership agreement or deed, you need to visit your nearest regional Sub-Registrar and register the Partnership Deed. Remember, partnership deed has to be notarized and it requires a stamp duty. The minimum value of stamp duty for partnership agreement/deed in Bengaluru Karnataka is Rs. 2000 and it varies from state to state as per their States Government Rules.
After verifying all the details of the Partnership Deed and partners documents, if the Registrar is being satisfied with your novelty then he shall enter your record of statements into Register of Firms and issue an acknowledgement of registration for your Partnership Firm, according to the Section-58(1) of the Indian Partnership Act.
The essential characteristics of Partnership Deed Agreement are as follows:
Required below mentioned details while preparing the Partnership Deed is as follows:
Step-3: Apply PAN card online for Partnership Firm – After receiving Acknowledgement of Registration of firm or Certificate of Registration for partnership, you can proceed to apply PAN for partnership firm.
Documents required for applying PAN card for partnership firm
Step-4: Open a Current Bank Account for your Company based on the Firm PAN card and Registered Partnership Deed – You can apply for a Current Account for your partnership firm with the help of PAN card, Partnership Deed and Certificate of Registration where all the transaction of firm accounts are to be kept here for future financial purpose.
Documents required for applying Current Account for partnership firm
The minimum essential documents required for Partnership Registration are as follows:
Partnership firm business is the most popular type of business organization in India since the early days of business because it is easy to form, has no complicated legal formalities and less compliances as compared to private limited company, limited liability partnership and one person company; but each and every business entity has the special unique features to carry out the business.
Whenever entrepreneurs or the innovators are thinking about to setup a business entity, they are more likely to intend to start a partnership business rather than others; because it creates more trustworthy to their clients for its bonding nature and characteristics. Only two partners of the company can run the business; if they want to grow their business, they can add partners and invest capital to expand their business by implementing with some creative ideas and better customer service, journey starts from here towards your goal.