Notice: Function _load_textdomain_just_in_time was called incorrectly. Translation loading for the rocket domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /var/www/wp-includes/functions.php on line 6114

Notice: Function _load_textdomain_just_in_time was called incorrectly. Translation loading for the zoho-flow domain was triggered too early. This is usually an indicator for some code in the plugin or theme running too early. Translations should be loaded at the init action or later. Please see Debugging in WordPress for more information. (This message was added in version 6.7.0.) in /var/www/wp-includes/functions.php on line 6114
Public Company - FirstStage

info@firststage.in

+91 74282 38001

Pay Now

Public Company

Overview​ Naming Criteria Eligibility Documents Required Advantages & Disadvantages Exemptions FAQs

The term “public company” has been defined under Section 2(71) of The Companies Act, 2013. A public company means a company which –

  1. Is not private company;
  2. Has a minimum paid-up share capital as may be prescribed;

Provided that a company which is a subsidiary of a company, not being a private company, shall be deemed to be a public company for the purposes of this Act even where such subsidiary company continues to be a private company in its articles.

Naming Criteria of a Public Company

  1. Any company should have a short, unique and meaningful name shall not be identical with or too nearly resembles the name of an existing company.
  1. No company shall have a name which, in the opinion of Central Government, is undesirable or the name proposed resembles any connection with Government or State patronage, unless prior approval of the Central Government is obtained.
  1. The name should not be such that its use by the company will constitute on offence under any law.
  1. The name should not be illegal or offensive.
  1. The name should not be misleading for the public.
  2. The Companies Act 2013 provides that the name of a public limited company must end with the word “Limited”.

Eligibility for registering a Public Company

  1. The minimum age of the person to be a director in the company should be at least 18. 
  2. A resident or citizen of India can become a shareholder or director of the company.
  3. One of the Directors of a public limited company has to be an Indian Citizen and Indian Resident.
  4. The other director(s) can be a Foreign National.
  5. The shareholders can be natural persons or an artificial legal entity.

Minimum requirements of a Public Company

  1. Minimum 7 members
  2. Minimum 3 directors

Maximum requirements of a Public Company

  1. Maximum members can be unlimited
  2. Maximum 15 directors

Documents/Details Required for Incorporation of a Public Company

Following self-attested documents of the Proposed Director and members is required: 

  1. Two identity proof documents of Directors and Shareholders – Copy of Aadhaar Card/ Voter ID Card/ PAN Card (compulsory).
  2. Address proof of the Director or the Shareholder (Voter ID, Passport, Driving license, etc.)
  3. Ownership and sale deed (In case your own premise) and one address proof document of registered office (like water, telephone, mobile bill or copy of bank pass book or net banking statement mentioning address of the applicant).
  4. Name of the city where the registered office is located.
  5. Passport size photo of the proposed director & shareholders.
  6. In case the property is on rent then you need to submit a copy of the rent agreement with NOC from Landlord.
  7. Occupation details, Email address, Contact details of directors as well as shareholders.
  8. Affidavits for non- acceptance.
  9. MOA and AOA subscriber sheets.
  10. DIN (Director Identification Number) of all directors.
  11. DSC (Digital Signature Certificate) of all directors.
  12. PAN Card of the company.
  13. Nationality proof of foreign national subscriber (if any).

Documents/Details Required for GST Registration of a Public Company After Incorporation

  1. PAN card of the company.
  2. Certificate of Incorporation (COI).
  3. MOA and AOA of the company.
  4. Proof of identity of all the directors. Such documents include Aadhaar, PAN, Passport, Driving license or any other Government-issued identity document would be required.
  5. Details of bank.
  6. In case of leased property, the copy of lease deed for the registered office premises along with a NOC from Landlord and electricity bill/property tax receipt/water bill copy of the registered office property.
  7. In case of own property, copy of sale deed along with the electricity bill/property tax receipt/water bill copy of the registered office property.
  8. Appointment Proof of authorised signatory.
  9. Board Resolution for GST Registration and person authorised in the GST (if more than one director or authorised person is other than single director) is mandatorily required.

Advantages

  1. There is a Limited risk to personal assets in Public Limited Company.
  1. Public Limited Company is a Separate Legal Entity.
  1. In the Public Limited Company there would Limited Liability for members.
  2. A company being an independent legal entity can sue and be sued in its own name.

Disadvantages

  1. Public limited company has a lot of compliances and legal formalities, failing which, can lead to heavy penalties.
  1. Unlimited number of members can subscribe to its shares if it’s listed on stock market leading to lot of interference.
  2. Listed public companies are pressurized by the stock market and they always have to see that no infringement of law happens.

Exemptions for a Public Limited Company

Very few exemptions are given to a Public Limited Company, which are:-

  1. Appointment of Woman Director is mandatory only to:-
  • Company having paid–up share capital of Rs. 100 crore or more; or
  • Company having turnover of Rs. 300 crore or more.
  • Listed company.
  1. Appointment of Woman Independent Directors is not applicable to Public Company, but top 1000 listed entities shall have at least 1 Independent Woman Director.
  1. Composition of Audit Committee is mandatory only to:-
  • Company having paid-up share capital of Rs. 10 crore or more; and
  • Company having turnover of Rs. 100 crore or more; and
  • Company having aggregate outstanding loans of Rs. 50 crore or more.
  • Listed company.
  1. Composition of Nomination and Remuneration Committee is mandatory only to:-
  • Company having paid-up share capital of Rs. 10 crore or more; and
  • Company having turnover of Rs. 100 crore or more; and
  • Company having aggregate outstanding loans of Rs. 50 crore or more.
  • Listed company.
  1. Composition of Risk Management Committee is not applicable to Public Company, but it is applicable on top 1000 listed entities, determined on the basis of market capitalisation, as at the end of the immediate previous financial year.

FAQs

A private company means a company, which has such minimum paid-up share capital as may be prescribed and which by its articles provide the following:- i. Restricts the right to transfer its shares; ii. Except is case of one person company (OPC), limits the number of its members to 200 excluding present and past employees who continue to be the members of the company (here joint members shall be counted as one); and iii. Prohibits any invitation to the public to subscribe for any securities of the company.

There should be at least two members and two directors in a Private Company.

There can be a maximum of 200 members and 15 directors in a Private Company.

Alteration of its articles thereby deleting the 3 restrictions, changing its name thereby deleting the word “private” from its name, increase the number of members to at least 7 and number of directors should be increased to at least 3.

A Private Company may convert itself into an OPC by passing a Special Resolution in the general meeting after obtaining NOC in writing from its members and creditors. The company shall file an application in Form INC-6 for its conversion into One Person Company.

Copy of Aadhaar Card, Voter ID Card, PAN Card (compulsory), Passport, Driving license, Water bill, Telephone bill, Mobile bill or Copy of bank pass book or Net banking statement mentioning address of the applicant, Passport size photo of the proposed director & shareholders, copy of the rent agreement with NOC from Landlord, PAN Card of the company, etc.

The cost could be anywhere between Rs. 6000 to Rs. 10000.

Yes, small business and start-ups get benefits of getting themselves registered as a private company. They get the advantage of credibility and good reputation in the eyes of big financial institutions, clients and suppliers. Also, they get easy loans from banks.

The person should meet the conditions like the minimum age of the person should be 21 and resident or citizen of India to become a shareholder or director of the company.

INC – 32 (SPICE+), INC – 33 (e-MOA), INC – 34(e-AOA), INC – 35 (AGILE PRO), INC – 9, DIR – 12, DIR – 2 and INC – 22.

DIN is Director Identification Number. Any person planning to become a director in a company must apply for a DIN, issued by the Ministry of Corporate Affairs.

Yes, every foreign national, entity or a NRI can become a director or shareholder of a private limited company in India.

CONTACT US

Fill up the form and our team will get back to you in 24 hours.

Created with Fabric.js 1.7.22

+91 74282 38001

Created with Fabric.js 1.7.22

info@firststage.in

Created with Fabric.js 1.7.22

B-1/637, 3rd floor East Metro, Janakpuri, Delhi, 110058

2022 FIRST STAGE IS THE LEADING PROVIDER OF BUSINESS, LEGAL & TAX SOLUTIONS IN INDIA.

© 2024. All Rights Reserved.