What is the process for establishing a private limited company in India?

Establishing a private limited company can be a lengthy and complicated process involving multiple steps:

First, a minimum of two directors must be appointed and registered through India’s e-filing system for the establishment of a private limited company include the existence of two directors, two shareholders (who may be the same person as the directors) and a minimum share capital of INR 100,000.

Second, a suitable name must be selected that indicates the main objectives of the company and submitted with the Registrar of Companies (ROC) along with a brief description of the business’s proposed functions to verify both the name’s appropriateness and availability. Upon successful name registration, the applicant company has 60 days to file its Memorandum of Association (MOA) and Articles of Association (AOA), and proceed with formal incorporation filings. Both the MOA and the AOA must be stamped with the appropriate duty after the needed ROC fees and stamp duty have been paid, and both forms signed by at least two subscribers with a witness.

Within this 10-day time window, the following documents must also be filed with the Ministry of Corporate Affairs web portal along with the requisite filing fees:

• Form 1: Application for incorporation along with the MOA and AOA.
• Form 18: Notice of situation for the registered office (proof of address, etc.).
• Form 32: Details of the company’s board of directors.

Upon successful submission of the above documents, the ROC will issue a Certificate of Incorporation and a Corporate Identification Number (Corporate Identity). The process generally takes 7 to 8 weeks to complete, and private limited companies are permitted to commerce business immediately following their successful incorporation.