Private Limited Company

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All You Need To Know About Private Limited Company

What is private limited company?

A private limited or Pvt Ltd is a company registered under Companies Act,2013 and regulated by Ministry of corporate affairs (MCA)having a minimum paid-up share capital as may be prescribed and can be established by a few individuals privately. The company’s ownership is limited to that few shareholders or individuals. It is one of the most famous business structure so far in India as it give benefits of Limited Liability Partnership, Ownership control and Scalability.

Definition as per the Companies Act, 2013

“Private Company” means a company having a minimum paid-up share capital as may be prescribed, and which by its articles—

1. Ristrict the Right to Transfer of shares:

except in case of One Person Company, limits the number of its members to two hundred:

Provided that where two or more persons hold one or more shares in a company jointly, they shall, for the purposes of this clause, be treated as a single member:

Provided further that—

(A) persons who are in the employment of the company; and

(B) persons who, having been formerly in the employment of the company, were members of the

company while in that employment and have continued to be members after the employment ceased,

shall not be included in the number of members; and

2. Limits the Number of Members:  

A private limited company can have a maximum of 200 members, excluding current and former employees who hold shares. This limit ensures the company remains a private entity. (Exception: A One Person Company (OPC) can have only one member.)

3. Prohibits any invitation to the public to subscribe for any securities of the company;

This makes private limited companies more focused on raising capital privately, such as through friends, family, or institutional investors.

Features of a private limited company

1. Separate legal entity :

It means the company and it’s owner are separate from each other and the company is treated as Independent entity that gives it right to sue and be sued, own property and having stamp in its own name.

2. Limited Liability protection

3. Perpetual succession:

It means the company continue to exist irrespective of any changes in the member or shareholder or owner of the company.

4. Eligibility of foreign direct investment:

The company can raise 100% foreign Investment without any prior approval

5. Board of directors:

You can start the company with 2 directors with one needs to be Indian resident and maximum can be 15 directors.

Documents required to register it in india:

Identity and Address proof of the Shareholders

Passport size photographs of the director
Copy of Identity proof like Aadhar card and Driving License or Voter id card
Pan card
Copy of Bank statement
Utility bill (Not older than 2 months)
Passport (If foreign national or NRI)

Address Proof of Registered Office

Copy of electricity bill, phone bill or any other utility bill (not more than 2 months)
Rent Agreement (If rented)
No objection Certificate (NOC) from the owner

Director Identification Number (DIN) of the director
Digital Signature certificate (DSC) of the directors

**Other Optional Documents (if applicable):

Private Limited Company

All You Need To Know About Private Limited Company

What is private limited company?

Features of a private limited company

Documents required to register it in india:

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