Company Registration

The 'Company' form of organisation is the most common incorporated business structure in India. Introduced during the British rule, the 'company' structure was retained even after India gained independence, within a reworked legislative framework.

In India, a 'Limited Company' is a business organisation registered under the Companies Act, 2013 for doing business in a particular jurisdiction. It is an association of persons (individuals or body corporate like Companies and LLPs) registered under the Act. It is one of the most accepted business structure in India.

The company registration in India is regulated by the Companies Act, 2013 and Rules made there under and is administered by the Ministry of Corporate Affairs ( through offices of the Registrar of Companies (ROC) in each state.

Types of Companies

The following are the Types of Limited Companies that can be registered in India

  • Private Limited Company
  • One Person Company
  • Public Limited Company
  • Section 8 Companies - Non Profit Company
  • Guarantee Company

Private Company

A 'Private Company' is a limited company formed with minimum of 2 members and 2 Directors. The maximum number of members in a private company is restricted to 200. The name of the company should end with the words 'Private Limited'. A 'Private Limited' company is the most common incorporated business organisation in India. It is generally called as a 'Private Company'.

One Person Company

One Person Company (OPC) means a company which has only one person as a member. Only an individual who is an Indian citizen and resident in India can incorporate a One Person Company.

One Person Company should have only one person as its member and have a minimum paid-up share capital of One Lakh Rupees and maximum Fifty Lakhs and restricts the right to transfer its shares by its articles. OPC is a private company under Companies Act.

Public Company

As the name reveals, a public limited company has a wider coverage than a private limited company. It is generally called a 'Public Company'. Minimum number of shareholders and directors are 7 and 3 respectively. There is no restriction on maximum number of shareholders.

Generally, companies requiring huge capital investment from a large base of shareholders are opting for registration as a Public Limited Company.

Section 8 Companies

A company can be registered with object to promote Commerce, Science, Art, Religion, Charity or other socially useful objects and not to make any profit. So, these companies generally called as Section 8 Company as the registration of such company is subject to the provisions of Section 8 of the Companies Act, 2013. A Section 8 Company shall not pay any dividend to its members but apply its surplus of receipts over payments for promotion of its objects. These companies need not use the words Limited or Private Limited after the name.

Guarantee Company

Guarantee Company is a sub classification of Private or Public Companies. Usually it does not have share capital but instead has members who act as guarantors. The guarantors give an undertaking to contribute a nominal amount (typically very small) in the event of the winding up of the company. This type of company may also have capital and in that case, members are liable to pay the capital amount taken as well as the guarantee amount.

Usually these companies are formed for Clubs and associations wherein members are not looking for profit.