Registration of Small Business in India is completely is a method to get them under the legal benefits provided by the Government. However, it is not necessary or compulsory for the small businesses to register themselves and is a voluntary step. The small businesses in India are registered under the Commissioner of Industries/ District Industries Centre/State Directorates. In India there are 8 types of business entities that can be set up. These are namely; One Person Company, Non-Banking Financial Corporations, Sole Proprietorship Company, Limited Liability Partnership, Private Limited Company, Public Limited Company, Co-Operative Organizations and Joint Hindu Family Business. The very first step to start a small business and registering it starts with choosing the right type of business organization as per the needs.
Process for Registration of Small Business in India:
In India the process of registering small business has a step by step guide in which each and every point is important and necessary to follow. Every business type attracts a different set of steps while registering themselves but certain steps are common to all types of businesses. For specific licenses in India there are different Government authorities. The steps are:
- Obtaining the Digital Signature.
- Obtaining the Director Identification Number.
- Securing a name for the company.
- Drafting the Memorandum of Association (MoA) and Articles of Association (AoA).
- Filing INC-29 for obtaining the Incorporation Certificate.
- Obtaining Permanent Account Number (PAN).
- Opening a current account.
- Obtaining MSME Udyog Aadhaar Registration.
- Applying for TAN.
- Getting service tax registration.
- Getting license under Shops and Establishments Act.
- Getting GST registration.
- Obtaining Professional Tax Registration.
- Registering with Employee’s Provident Fund if the business has more than 20 employees.
- Registering with State Employee’s Insurance Corporation.
- Getting Importer Exporter Code (IEC) Registration.
- Registering with custom duty.
- Obtaining Intellectual Property Registration.
- Applying for AGMARK in case of agricultural based businesses.
- No Objection Certificate from Pollution Control Board.
- Obtaining FSSAI Registration in case of food related business start-ups.
Documents required during Application of Registration of Small Business in India:
Here is a list of documents that are required while application for registering the small business-
- Clearance certificate from the Pollution Control Board.
- A No issue certificate from the respective municipal corporation in the area.
- Clearance certificate from the electricity board in the area.
- If it is a partnership business then, a copy of the partnership business.
- In case of private business, copy of the Memorandum of Association and Articles of Association and other legal documents.
- Ownership or tenancy rights of the place where the business is to be established.
- Purchase bills of all the installed machineries and raw materials to start the business.
- Sale bills of all the products and materials manufactured or provided by the business in India.
- Proof of existence of the small business in India through an affidavit stating its machinery installed, power requirements, nature and everything.
Benefits of Registering the Small Business in India:
- The small business gets a legal identity.
- It can claim against any mistreat or infringements.
- They get ISO-9000 certification reimbursement.
- They get benefits of reduced custom duties.
- Exemption from certain taxation laws.
- They get capital subsidies.
- They get subsidies on power consumption tariffs.
- They get benefits of credit guarantee scheme.
They get priorities in lending sectors as well.