Types of Registration for Company

The process of company registration depends on the type of the company, which could be a Private Limited Company, One Person Company, Limited Company, or Section 8 Company. Under the Companies Act of 2013, various types of company registration can be chosen based on the activity and requirement of the promoters.

Registration Under Companies Act, 2013:

Private Limited Company:

In India, this is the most common type of company entity. Business and personal assets are segregated in a private limited corporation. Each shareholder is therefore only accountable for his or her portion of the total capital. A Private Limited Company must maintain records of financial transactions, board meetings, yearly reports, and other things in order to be in compliance. Additionally, the entity’s entire capital consists of shares, which can be sold or transferred to another person, who thereafter joins the original owner as a shareholder. A private limited company’s shares cannot be sold on a stock exchange, nor can it launch an initial public offering (IPO) for the general public.

Criteria for Registration;

1. Two minimum and fifteen maximum directors.
2. A resident of India is required for at least one of the directors.
3. Two minimum and 200 maximum shareholders or members
4. Moreover, an authorised capital fee of at least Rs. 1 lakh.
5. Must have an Indian registered office address.

Types of Private Companies:

1. Limited by shares: In these private limited businesses, the members’ liability is capped at the fair market value of the shares they possess.
2. Limited by guarantee: In this instance, the amount that the members will contribute to or promise to pay in the event that the company files for bankruptcy limits the liability of the members.

Public Limited Company:

A public limited corporation is one whose shares are available for purchase by the general public. There is no limit to the number of shares that can be purchased, sold, or traded in such business entities. Because the company’s shares are freely traded because they are listed on the stock exchange, the shareholders are co-owners of the company. Before they can begin operations, these companies must obtain a certificate of registration from the RoC.

Criteria for Registration:

1. At least three directors.
2. A resident of India is required for at least one of the directors.
3. With a minimum of seven shareholders and no maximum cap.
4. A capital fee that is authorised is at least five lakhs.
5. Must have an Indian registered office address.

Partnership:

Business entities that are partnerships resemble sole proprietorships quite a bit.

The fact that a partnership involves more than one person sets it apart from a single proprietorship on a fundamental level. The tasks, obligations, and ownership stakes of each partner are clearly laid out in a legal partnership agreement. Since each partner is personally liable for any losses, the formal partnership agreement specifies how the business’s profits will be divided amongst the partners.

Criteria for Registration:

1. With a minimum of two and a maximum of ten partners.
2. Must have an Indian registered office address.
3. All partners must sign a registered partnership deed.

Limited Liability Partnership:

The idea of an LLP was first presented as a structured business model in 2009. It is a distinct legal entity from the partnership entity, according to one definition.

When the partners’ personal and corporate assets are segregated. Partners’ private assets are not in danger. If the company experiences losses, each partner’s maximum culpability is determined by the value of his equity stake in the company.

Criteria for Registration:

1. One lakh is the minimum amount of authorised capital.
2. The chosen partners must all reside in India, at least one of them.
3. Minimum of two partners, with no maximum allowed.
4. If the others are corporate entities, at least one partner must be an individual.
5. Since each partner must provide a mutually agreed-upon contribution, there is no need for shared capital.

One Person Company:

The Companies Act of 2013 created the concept of a single-person business. Supporting entrepreneurs who could launch a business on their own was the main goal. Additionally, enabling them to establish a single-person economic organisation accomplishes this. It’s noteworthy to observe that OPC only allows one member.

Contrarily, in order to form and maintain a Private Limited Company or a Limited Liability Partnership, there must be a minimum of two members. One of the main benefits of OPC Registration is this. The sole type of business registration under the Companies Act of 2013 that only permits one member is OPC Registration.

Section 8 Company:

An organisation that is registered as a non-profit organisation is a section 8 corporation (NPO). The main goal includes promoting the arts, business, charity, education, environmental conservation, etc. The application of its revenues, if any, or other money is therefore employed to further the goals.

It performs similar activities to a limited business and has all the rights and obligations associated with one. It’s important to note that it differs from a business in one very fundamental way, namely that its name cannot contain the terms “Section 8” or “Limited.”