There are number of company structures in India that can be chosen by the aspiring entrepreneurs like the private limited company, Limited liability partnership, sec 8, sole proprietorship, public limited company etc. Each of these structures differs from each other on the basis of their features, minimum number of members, directors, capital required and the compliances requirement etc. When a person requires starting the company at a large scale the best option that comes up for him is Public Limited Company. It is a company structure through which the capital can be raised from the public at large. As the large amount of public money is involved the public limited companies are strictly regulated and it is required to provide the complete details. Through this blog we will be discussing the various aspects related to the public limited company in India.
What are the requirements of public limited company?
Directors – In order to start the public limited company there is a requirement of getting on board at least 3 directors while there is no limit on the maximum number of directors.
Shareholders – Unlike the private limited, the public limited company is required to have minimum 7 shareholders whereas there is no limit on the maximum number of shareholders.
Capital Required – For starting the public limited company in India there is a requirement of having the minimum capital of 5 lakhs.
Name of the company – In the name of every LLP the word limited must be added mandatorily.
Prospectus – The public limited company is empowered to raise funds from the public at large unlike the private limited company. The public limited company is required to issue a prospectus containing the complete details of the state of company for its public.
What are the advantages of starting a public limited company?
There are multi-facet benefits of starting a public limited company in India. Some of these benefits are as follows –
Better Growth Opportunities – With the public limited company there are better growth opportunities for the company and it can take up new and huge projects.
More share capital – The private limited company is empowered to raise money from the public at large. Due to this the public limited company is able to raise more funds than other kinds of business structures.
Better company image – A public limited company is usually listed on a recognised stock exchange thus it helps it to build a better corporate image among the public at large.
What are the documents required for the registration of public limited company?
- Two passport size photographs
- PAN card of the directors and shareholders
- Identity proof for the shareholder and director(voter ID/ Passport/Driving license)
- Address proof of the director and shareholders(any of the utility bills not older than 2 months)
- For the registered office address proof the utility bills of registered office address, NOC of the landlord and the rent agreement.
What is the procedure to get the public limited company registered in India?
The procedure of registering a public limited company is somewhat similar to the private limited company however there are some changes in the form filing requirements. Here we list out the major steps involved in the procedure of public limited company registration in India –
Name Reservation – The first step in the process of public company registration is getting the name reserved for the company. The reserve unique name shall be filed for the name of company and the name approval once approved is valid for the period for 20 days.
Obtaining the DIN and DSC approval – In order to act as a director every person is required to obtain the valid Digital Signature Certificate and the Director’s Identification Number. The DSC obtained by the directors are used to sign and authenticate all the documents submitted online. Without putting the valid DIN and DSC no director can file the company documents.
Approval from appropriate authority – There may be a requirement of taking approvals from the certain authorities according to the activity of the company like the state or central government department.
Execution of the MOA and AOA – After receiving the name approval the Memorandum of Association and the Article of Association must be executed by the promoters. The electronic form INC-33 and the INC-34 shall be filed electronically.
Submission of documents to ROC – Once the electronic MOA and AOA are executed the same must be submitted with the registrar of companies for the registration.
Registration of the Company – The ROC will conduct the complete checking of the Article of Association and the Memorandum of Association and then he will issue a certificate of incorporation. Apart from this, a Corporate identification Number will also be allotted to the company by the Registrar of Companies.
Certificate of Commencement – Even after receiving the certificate of registration the public company cannot start its activity unless it does not receive the certificate of commencement. The company shall apply for certificate of commencement to start its activities.
To take any other assistance or to know more about the procedure of public limited company feel free to get in touch with lawdef anytime.