By choosing to register a company, you are already one step closer to start your business. Like many business owners, you may find it very difficult to register a company in India. However, the process of registration will become easier if you have the know-how.
While it’s always a good idea to start big, we suggest you to go through following 5 important things before you start the company registration process.
Company name
Company name approval is the first step of your company registration. You need to apply for the approval by using RUN features in MCA site.
While applying, you must ensure that company with a similar name doesn’t exist and no one has trademark registration on it. In addition to it, you should not use certain words and expressions in your company name while processing application.
If a company already exist with a similar name and line of business, then company name will not get approved.
You need to be very careful while choosing your company name as it may delay the whole process.
If somehow you get a name approved which has similar trademark registration, then you may get legal notices from the trademark owner for using their name or similar name for commercial purpose. After getting registration, to avoid future disputes, it’s always suggested to apply for trademark registration.
Proposed Registered office address
After getting proposed name approved for registration, you need to fill up registration form for final approval. In this form, you have the option of giving office address at the time of registration. You can choose the given address as your correspondence or registered office address.
If you have chosen the given address as registered office then in addition to other documents, you are required to attach rent agreement, electricity bill and no objection certificate from the landlord. Documents requirement will change based on circumstances. For instance, if the proposed office address is owned by you or any director then ownership proof, NOC and utility bill will serve the purpose.
In case, you have chosen the address as your correspondence office instead of registered office, then a separate form is required to be filed within 30 days from the date of incorporation. At this time, you have to provide all the documents to support the address as registered office. We suggest you to file it on or before 30 days from the date of incorporation or else you need to pay additional fee for delay in filing.
Whatever address you choose, either registered or correspondence, it will get printed on the certificate of incorporation.
The registered office need not be the main place of your business, but it should be a place where you can always receive all type of correspondence as it’s a address to which important and official documents are sent including letter of legal proceedings. If you are operating from some other place, then you can mention that address as your corporate office.
Share allocations
Paid up share capital must be distributed based on the percentage of holding at the time of registration in memorandum of association with details such as their name, address and date of birth. You need to make sure that the address as per memorandum of association matches with the address proof of subscribers.
Whatever ratio of holdings you have decided at the time of registration, it will reflect as number of shares held by you out of the total paid up share capital. You can always change the shareholding pattern at a later state, but it’s always suggested to get it right at the time of registration as changes at a later stage requires money and time.
Main objective of the company
Main object in the memorandum of association will define the type of activities your company will carry post incorporation.
If a particular type of business is not mentioned in main object clause of the memorandum of association, then the company can not carry that business. You have to be very careful while choosing your main object. We suggest you to consult your finance professional to draft it for your review before starting the registration process.
If any activities has been missed out, you can amend your moa at a later date to carry on the business. However, you have to follow the legal process for the same. Instead of all this headache, it’s better to incorporate it at the time of registration.
Company’s directors
First director of the company gets appointed at the time of incorporation. You need to decide it at the time of filing the form as it will have director details with declaration and particular details attached to it.
You can also mention director details in the article of association. You can be specific to mention that who has been appointed as managing director out of them.
Post incorporation, your director details are get updated in MCA database and in future these are the people allowed to carry on the business and will file all types of documents with the register.
By keeping above 5 things right at the time of company registration, you can avoid certain legal compliance in future and save money and time.
