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Company Incorporation

Accuprosys

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THE COMPANIES ACT 1956 GOVERNS COMPANY INCORPORATION IN INDIA. THIS COULD BE SAID AS THE MOST SIGNIFICANT PART OF STATUTE LAW WHICH AUTHORIZES THE CENTRAL GOVERNMENT TO MODULATE THE FORMATION, FUNCTIONING, AND FINANCING COMPANIES.

This is applicable to all of India and to all kinds of companies, which either could have been registered under this Act or a previous Act.

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But, this Act is not applicable to universities, scientific, co-operative, unincorporated trading, and other

societies.

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The Companies Act is governed by the Central Government by the Ministry of Corporate Affairs and the Offices of Registrar of Companies, Public Trustee, Official

Liquidators, Director of Inspection, Company Law Board, etc.

The Companies Act is governed by the Central Government by the Ministry of Corporate Affairs and the Offices of Registrar of Companies, Public Trustee, Official Liquidators, Director of Inspection, Company Law Board, etc.

The Official Liquidators that are affiliated to the several High Courts operating around the country come also within the universal bureaucratic supervision of the Ministry.

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THE ESTABLISHMENT AT THE HEADQUARTERS COMPRISES OF COMPANY LAW BOARD, A QUASI-JUDICIAL BODY, THAT HAS THE PRINCIPAL BENCH AT NEW DELHI, AN EXTRA PRINCIPAL BENCH FOR SOUTHERN REGION AT CHENNAI, AND FOUR REGIONAL BENCHES SITUATED AT NEW DELHI, MUMBAI, KOLKATA, AND CHENNAI.

The administration at the Headquarters also consists of an Economic Adviser for Research and Statistics, two Directors of Inspection and Investigation with the addition of staff, and other Officials who render expertise on legal, economic, accounting, and statistical matters.

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• The four Regional Directors, who are in control of the various regions, monitor the functioning of the Offices of Registrars of Companies, make up a number of States and Union Territories, among other things, and the Official Liquidators operating in their regions.

They also sustain contact with the various State Governments and the Central Government in things concerning the administration of the Companies Act, 1956.

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Their offices work as registry of records pertaining to the companies that are registered with them.

• Registrar of Companies (ROCs) constituted under Section 609 of the Companies Act, that spread across various States and Union Territories, are accorded with the main duty of registering companies started in the various States and the Union Territories and making sure that these companies abide with the statutory prerequisites under the Act.

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With regards to registration and company incorporation, an application has to be registered with the Registrar of companies.

• Application for registration of a company along with the – selected names, – Articles of Association, – Memorandum of Association, and other essential

documents

is to be lodged with the Registrar of Companies of the State where the proposed company is to be incorporated.

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Within the Companies Act, an

enterprise can embark on two types of companies, i.e., a private

company or a public company.

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In a Private Company the articles contains the restrictions such as

Limits the lower limit of paid up share capital to like an amount that could be ordered but one that should not be less than 1 lakh rupees;

limits the count of its members to fifty omitting the past or present employees of the company who are members of the company;

confines the privileges of members to channel its shares, if any; forbids any request to the public to sign in for any shares or debentures of

the company; Does not welcome or take any deposits from people other than the

members, directors, or their relatives.

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LIKEWISE, THE LOWER LIMIT FIGURE OF MEMBERS IN A PRIVATE COMPANY IS TWO AND A COMPANY LIKE THIS SHOULD HAVE THE WORDS 'PVT LTD' AS THE LAST PART OF ITS NAME.

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A Public Company, as defined in the Companies Act, has the following

features:-• Its shares are freely transferable; • It can invite general public to subscribe to its shares; • There is no ceiling on its membership; It has a minimum paid

up capital of Rs. 5 lakhs or such higher paid up capital as may be prescribed;

• It is a private company which is a subsidiary of a public company.

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ALSO, THE MINIMUM NUMBER OF MEMBERS IN A PUBLIC COMPANY IS SEVEN AND SUCH A COMPANY MUST HAVE THE WORD 'LTD' AS LAST PART OF ITS NAME.

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Advantages of Company Incorporation:

Incorporation provides sure-shot advantages to a company as likened

with all other types of business organizations.

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1) INDEPENDENT CORPORATE EXISTENCE

The most prominent characteristic of a company is its self-relying corporate being. By getting registered under the Companies Act, a company goes robed with corporate personality, which is self-governing, and unique from its members. A company is a legal individual.

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2) LIMITED LIABILITY

Restriction of liability is another main advantage of company incorporation. The company, being a separate entity, conducting its own business existence, the members are not subject to legal action for its debts. The liability of members is bounded by shares; each member is confined to pay out the token value of shares owned by them and their indebtedness stops at this point.

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3) PERPETUAL SUCCESSION

A company that is incorporated never goes out of existence. Members may come in and go out, but the company will exist forever.

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4) COMMON SEAL

As a company has no physical being, it should play by its agents and contracts like these got into by such agents should be under the stamp of the company. The common seal works as the official seal of the company.

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5) TRANSFERABLE SHARES

When joint stock companies are instituted the great aim was that the shares must be subject of being transferred very easily. One of the Law in the Companies Act gives reflection to this principle by furnishing that “the shares or other interest of any member should be movable property, transferable in the manner provided by the articles of the company.”

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6) SEPARATE PROPERTY

The belongings of an incorporated company is robed in the corporate body. The company is able to hold and enjoy property in its own name. No members or all of the members can take possession of any asset from the company’s assets.

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7) CAPACITY FOR SUITS

A company can sue and be sued in its own name. The names of managerial members need not be impleaded.

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8) PROFESSIONAL MANAGEMENT

A company is able to pull professional managers. It is because of the reality that being connected to the management of the company affords them the position of business or executive class.

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Accuprosys with its elite panel of experts is one of the leading

companies with expertise in dealing with the different aspects of

company incorporation.

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