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Private Limited Company Registration and Its Characteristics

Finlogic Advisory Solution Private Limited Company offers a hassle-free and cost-effective private limited company registration in India. Leveraging their expertise, the company ensures secure and expedited services for a hassle-free experience..

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Private Limited Company Registration and Its Characteristics

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  1. Private Limited Company Registration and Its Characteristics Today in India, when anyone wants to start a business, their first preference of company type is private limited company registration due to its unlimited benefits to its promoters or shareholders. The business structure offers a level of protection against personal liability coupled with explicit ownership restrictions. What is a Private Limited Company in India? Private limited company registration in India is governed by the Ministry of Corporate Affairs and is incorporated under the Companies Act of 2013. It is a popular choice for entrepreneurs and small to medium-sized businesses. This popularity is primarily associated with its numerous advantages, including limited liability protection, ease of formation and maintenance, and its status as a distinct legal entity. What are the Characteristics of Private Limited Company Registration in India Here are the key characteristics of a Private Limited Company in India: ● Limited Risk to Personal Assets: The company is legally separate from its owner. If the company is bank-corrupted, then creditors only sell the company's assets and not the director's assets. ● Separate Legal Entity: A private limited company has its legal identity, i.e., It can own property, engage in contracts, and initiate or defend legal actions under its unique name. ● Number of Shareholders: The minimum number of shareholders is two, and the maximum is 200. ● Number of Directors: A private limited company requires a minimum of two directors, and one of them is a permanent resident of India. ● Minimum Share Capital: The company must maintain the 1 lakh minimum paid-up capital. ● Name of the Firm: The firm name concludes with the word 'Private Limited Company.' ● Limitations on Share Transfer: Share transfer within a private limited company is subject to restrictions. Approval from the Board of Directors or adherence to the provisions outlined in the company's Articles of Association is mandatory for any share transfer. ● Prohibition on Public Invitation: Private limited companies are prohibited from inviting the public to subscribe to their shares and debentures.

  2. Compliances Requirement: Private companies are accountable for a variety of legal and regulatory obligations, such as maintaining proper financial records, conducting annual general meetings, and filing annual returns with the ROC. ● In conclusion, a Private Limited Company in India offers a compelling business structure with numerous advantages for entrepreneurs. The limited risk to personal assets, separate legal entity status, and specific ownership regulations make it a popular choice for those venturing into the business landscape.

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