Starting a Private Limited Company in Delhi

Private Limited Company in Delhi:

A Private Limited Company in Delhi is a company held by small businesses privately. In such type companies the owner’s liability is limited to the shareholdings i.e. not more than 200 and restricts the shareholders from trading the shares publically.

Private Limited in India:

In India, almost 93% of the incorporated companies have been registered as Private Limited Company. The Private Limited Companies in India are governed and regulated by the Ministry of Corporate Affairs and is regulated by the Companies Act, 2013. Earlier, it was a requirement for the shareholder had to pay Rs.100000 to subscribe in the incorporation of Private Limited Company but this rule has been finished now.

Why it is ideal for starting a Private Limited Company in Delhi:

The National Capital Territory of Delhi is the one of the most suitable places in India for starting a new business. It is at number 1 rank among the major 17 cities to start business. The process for registering   Pvt. Limited Company in Delhi has been made easy and quick with the efforts made by the Ministry of Corporate Affairs.

Advantage of Starting a Private Limited Company in Delhi:

The venture capitalists in prefer Private Limited Company. Investors find Pvt. Ltd. Company to be credible due to the following reasons-

  • A Private can be commenced from the date of its incorporation.
  • It can issue shares without issuing any prospectus.
  • It has separate status of being a legal entity.
  • It protects the personal assets by limiting the liability of the shareholder.
  • It requires minimum capital of Rs. 100000 to start a Private Limited Company in Delhi.

Disadvantages of Starting a Private Limited Company in Delhi:

  • There is no valuation of Investment: As shares of a Private Limited Company are never listed in the Stock Exchange thus, shareholders never get to know the real value of their shares.
  • It has smaller number of resources: The financial resources and credit sharing of a Private limited are comparatively lower than a Public Company.
  • Protection to its members is relatively poor: The minority members are always at a risk of suffering at the hands of the majority members. And if they want to leave the company shares they have to do that at a loss.
  • Lack of public confidence in the company: Since most of the affairs of a private limited company are unknown, public have very little confidence in it.
  • It lacks transferability of shares: A Private Limited Company has restrictions over transferring of shares by the shareholders thus they cannot leave the company easily.

Requirements for Starting a Private Limited Company in Delhi:

To start a Pvt. Limited company in Delhi at least 2 directors, minimum of 2 shareholders or maximum up to 200 shareholders and registered residential or non-residential office address is required. These are the essence of a Pvt. Limited company.

Process of a Company Registration of Private Limited in Delhi:

For Registration of Private Limited Company in Delhi the following steps must be taken in account-

  • One has to apply for Digital Signature Certificate.
  • Apply for the Director Identification Number.
  • Apply for approval of name with Registrar of companies,
  • Through new SPICE INC- 32 forms apply for registration.
  • Get the registration certificate.

Documents required for Registration of PVT. LTD. Company in Delhi:

  • Memorandum of Association or MOA is required.
  • Article of Association or AOA is required.
  • All the directors and first subscribers must provide with declaration and affidavits.
  • Address proof of office.
  • Copy of utility bills (electricity bill, water bill etc.) not older than 2 months.
  • Identity and residential address proof all the directors.
  • Identity and residential address proof all the subscribers.
  • Trademark registration certificate or copy of trademark application if the name proposed is based upon already registered trademark.
  • A No Objection Certificate from sole proprietor/partners/existing company.

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    Author: Anil Agrawal
    EZYBIZ India Consulting LLP, New Delhi. The firm is business and tax consultancy firm providing consultancy in Taxation, Regulatory, Transfer pricing, Valuation, Corporate funding and Business set up matters. He may be reached at 9899217778 or anil@ezybizindia.in.
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