Private Limited Company

Private Limited Company

Private Limited Company


Private Limited Companies are those types of companies where minimum number of members is two and maximum number is fifty. A private limited company has the limited liability of members but at the same time it has many characteristics as those of a partnership firm. A private limited company has all the advantages of partnership namely flexibility, greater capital combination of different and diversified abilities, etc., and at the same time it has advantages of limited liability, greater stability and legal entity. In this sense, a private limited company stands between partnership and widely owned public company. Identifying marks of a private limited company are name, number of members, shares, formation, management, directors and meetings, etc., The maximum number of directors shall have to be mentioned in the Articles of Association. In the grand of privileges and exemptions, the Companies Act has drawn a distinction between an independent private company and other private company which is a subsidiary to the other public company.

Private Limited Company Process


1. Pvt Ltd Company Registration
AdroitCorporation.in can incorporate a Private Limited Company in 14 to 20 days, subject to ROC processing time.
2. Obtaining DSC & DIN
Digital Signature Certificate(DSC) and Director Identification Number(DIN) is required for the proposed Directors of the Private Limited Company. DIN and DSC can be obtained for the proposed Directors within 5 to 7 days.
3. Name Approval
A minimum of one and a maximum of six proposed names must be submitted to the MCA. Subject to availability, naming guidelines and MCA processing time, Name Approval can be obtained in 5 to 7 working days.
4. Company Registration
Registration documents can be submitted to the MCA along with an application for registration. MCA will usually approve the application for incorporation in 5 to 7 days, subject to their processing time.
Advantages
Separate Legal Entity
A company is a legal entity and a juristic person established under the Act. Therefore a company form of organization has wide legal capacity and can own property and also incur debts. The members (Shareholders/Directors) of a company have no liability to the creditors of a company for such debts
Borrowing Capacity
A company enjoys better avenues for borrowing of funds. It can issue debentures, secured as well as unsecured and can also accept deposits from the public, etc. Even banking and financial institutions prefer to render large financial assistance to a company rather than partnership firms or proprietary concerns
Easy Transferability
Shares of a company limited by shares are transferable by a shareholder to any other person. Filing and signing a share transfer form and handing over the buyer of the shares along with share certificate can easily transfer shares.

Owning Property
A company being a juristic person, can acquire, own, enjoy and alienate, property in its own name. No shareholder can make any claim upon the property of the company so long as the company is a going concern
Limited Liability
Limited Liability means the status of being legally responsible only to a limited amount for debts of a company. Unlike proprietorships and partnerships, in a limited liability company the liability of the members in respect of the company
Capacity to sue and be sued
To sue means to institute legal proceedings against or to bring a suit in a court of law. Just as one person can bring a legal action in his/her own name against another in that person

Dual Relationship
In the company form of organization it is possible for a company to make a valid and effective contract with any of members. Thus, a person can at the same time be a shareholder, creditor, director and also an employee of the company.
Uninterrupted Existence
A company has “perpetual succession”, that is continued or uninterrupted existence until it is legally dissolved. A company, being a separate legal person, is unaffected by the death or other departure of any member but continues to be in existence irrespective of the changes in membership

FAQ


How many people required to incorporate a private limited company?
What are the requirements to be a Director?
What is the capital require to start a private limited company?
Is an office required for a starting a private limited company?