Ministry of Corporate affairs is an Indian ministry that is primarily concerned with Companies Act, 2013, Companies Act, 1956, Limited Liability partnership act 2008 and other rules and regulations. The responsibility of this Ministry is regulation of Indian enterprises in Industrial and Services sector.
Companies can be registered in India
Private Limited Company-It is the type of company recommended for Business. The cost of registration of the private limited company is cheaper than other forms of a company. Private limited should have a minimum of 2 members and can have maximum 200 members. In this company liabilities are limited and it has some features of a partnership.
People mostly prefer this of the company for fundraising. The degree of operation and ownership can easily separate in this type of company. Business can be exited without any hassle. In this members are limited to only contribute towards a number of shares.
One Person Company-It is the type of company which can be started by a Single member.OPC is the latest form of company in Companies Act, 2013. One person can become the director as well as the shareholder. Similar to the private limited company as the degree of operation and ownership are on the separate basis.
OPC gives wings in the hand of Sole proprietor to form the company under with full control. It is done without any interference of the third person. This type is easy for an entrepreneur to directly target the market. Fundraising from banks and the financial institution is easy. People who are Indians and resident in India can form OPC.
Public Limited Company-This is a publicly held company. A large amount of capital investment can easily be obtained. These types companies are considered to be a more transparent business model as compared to other business structures. Investors get the choice of transferring their ownership in the company without any hassle by just selling the shares.
Section 8 Company-These companies are basically formed to encourage arts science, sports, education, research, social welfare, religion, charity, etc. These kinds businesses do not play any vital role in profit. Company Intends to prohibit the payment of any dividend to its members. These companies are the non-profit making company.
Section 8 company was incorporated mainly for welfare purposes. Previously, it was defined as Section-25 Company. Due to commencement of Companies act, 2013 it was called as Section-8 Company
Nidhi Company- Nidhi Company comes from the Hindi word ‘Nidhi’ means fund. These are the NonBanking financial corporation. These are also known as mutual benefit funds. Nidhi company is known in the corporate scenario is member benefits company. Companies are formed for the welfare of the members and to increase saving habits.
Other types of Companies
There are some more types companies which can be registered in India.
Firm registration in India is a step-by-step process and every step in this process requires different documents to be submitted.
A standard procedure includes four major steps:
The documents required for the registration of a firm in India include all of the following.
Once the above documents are submitted, the documents are validated for authenticity and the registration process of a firm begins.
Limited Liability Partnership (LLP), which is limited liability partnership, is a company where all partners have limited liabilities. Here, one partner is not responsible for other partners’ diligence or negligence.
Features of LLP
Removal or resignation of a Partner from an LLP can happen for many reasons. A Partner may cease to exist as Partner in the LLP in the following scenarios:
A Partner may be removed from LLP only if the agreement provides such clauses or in the above-mentioned scenarios only. Until then, a majority of Partners cannot vote out a Partner from LLP.
Removal of Partner by majority will require filing a form within 30 days of the decision-making duly signed by a designated Partner and the records being validated by a chartered accountant.
Resignation by a Partner requires a notice of resignation 30 days in advance of the intention by the Partner. Other Partners must accept the resignation and all balances and debts must be settled as per agreement.
The procedure of removal or resignation of Partner from LLP is simple, although one should be prepared for the complexities it involves. Such as:
However the type and size of business, it is valued by its owner(s) and as the business grows, the bigger the value gets and hence higher the protection needed. The owner must understand the vulnerability that comes along with the success of a business, such as with success comes competition, risks, legal obligations, reputation sustenance, vigilant, etc.
An owner must be prepared to face the difficulties that come in building a successful business. There are no strict rules to be followed, however, certain aspects of protecting ones business remain constant in all cases.
Protection against legal threats
Organize your Finances
Protection against technological threats
Protection against reputation threats
Protecting a business can be a task but the efforts will make the success of a business only smoother. If the above major aspects are taken care of, the business is well protected and any hassle on its way of progress can be dealt with ease.
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