In India, there are generally two types of companies: Private Limited Company and a Public Company.

Private Limited Company is the more favored in India as it provides flexibility and requires fewer funds in comparison to a Public Company. The basic requirement to start is that there must be at least 2 members in the company and their objective must be legal whereas there must be at least 7 members to start a public limited company.

Importance of Registration:

1. Evasion of personal risks: The registration of the company disposes of the owner of personal obligations. Personal assets cannot be put at risk; rather the liability is limited to the number of shares held in the company.
2. Separate Legal Entity: By incorporation, a company gets its own identity and enjoys the benefits in its name.
3. Perpetual succession: The Company enjoys the right of perpetual succession as it has an unlimited period. Employees and members of the company may come and go, but the company exists until it is legally winded.
4. Reputation & credibility: The registration of the company highlights its permanent nature and effective management which gives confidence to the customers, clients, and other parties.
5. Legal Protection: If the company gets incorporated, the name of the company is protected and nobody can have a similar name. Also, the unauthorized use of the company name is protected after registration.

How to apply?

Registration process

The procedure of registration of a company is prescribed under section 7 of the Companies Act, 2013.

1. Obtaining Digital Signature Certificate (DSC) for the Directors of Company and obtaining Director Identification Number (DIN) for the Directors of the Company.
2. After obtaining DSC and DIN, an application must be applied for the name of the company.
3. Selection of company name. The names must not be similar or identical to any other registered company's name or the trademark. The name of the company should have "Private Limited" at the end as a suffix.
4. The registrar will look and finalize one of the names within 3 to 5 working days.
5. After finalizing the name, the promoter will file an application to the registrar along with the documents: Articles of Association, Memorandum of Association, Affidavits of the Directors, and Declaration from Directors.
6. The promoters of the company should provide the relevant information regarding the registered office of the company to the registrar within 15 days of filing the documents of incorporation.
7. After filling all the details and the relevant documents, the registrar will issue a Certificate of Incorporation and the company gets its separate legal entity.
8. It should be noted that if any person furnishes any false information or prohibits furnishing any material information that is to be filed with the registrar, then he shall be punished under section 447 of the Companies Act, 2013.

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