Company formation in India is governed primarily by the Companies Act, 2013, which provides the regulatory framework for the formation, governance, and dissolution of companies.
For the successful incorporation of a company, it is essential to comply with both statutory and regulatory requirements. The process, which is monitored by the Ministry of Corporate Affairs (MCA), involves submitting specific documents that validate the company’s identity, ownership, and objectives.
In this article, we will explore, in a detailed and accurate manner, the essential Documents Required for company formation in India.
I. Director Identification Number (DIN) and Digital Signature Certificate (DSC)
To commence the incorporation process, obtaining a Director Identification Number (DIN) and Digital Signature Certificate (DSC) is mandatory for the directors. DIN, governed under Section 153 of the Companies Act, 2013, is an exclusive identification number allotted to an individual who wishes to become a director of any company. The DIN application (Form DIR-3) requires the submission of:
- Proof of identity (Aadhar Card, PAN Card, or Passport for foreign nationals).
- Proof of residence (bank statements or utility bills not older than two months).
- Passport-sized photographs of the applicant.
A Digital Signature Certificate (DSC) is necessary for electronically signing the incorporation documents, such as the e-forms required by the MCA portal. The applicant must obtain the DSC from certified agencies authorized by the Controller of Certifying Authorities (CCA) in India.
II. Name Reservation through RUN (Reserve Unique Name) Application
Before filing the incorporation documents, reserving the proposed company’s name is a crucial step. The RUN (Reserve Unique Name) service provided by the Ministry of Corporate Affairs (MCA) allows companies to apply for name approval.
The chosen name must comply with Rule 8 of the Companies (Incorporation) Rules, 2014, which outlines guidelines on how to choose names that are neither identical nor too similar to existing registered companies.
The application for name reservation can be submitted through the RUN form available on the MCA portal. The applicant must provide:
- Two name options for the proposed company.
- A brief description of the business activity to justify the chosen name.
Once approved, the name is reserved for a period of 20 days for new companies. If the name is not used within this period, the company will have to re-apply for a fresh name approval. It is mandatory to mention the reserved name in all further Documents Required for company formation in India, including the incorporation forms filed with the Registrar of Companies (RoC).
III. Memorandum of Association (MoA) and Articles of Association (AoA)
The Memorandum of Association (MoA) and Articles of Association (AoA) are two foundational documents required for company formation in India. These documents define the company’s objectives, governance structure, and internal operational rules, and are crucial among the Documents Required for company formation in India.
Memorandum of Association (MoA): The MoA outlines the company’s fundamental objectives and scope of operations.
It contains six clauses: Name Clause, Registered Office Clause, Object Clause, Liability Clause, Capital Clause, and Subscription Clause.
This document serves as the company’s charter, and it is mandatory that the objectives stated within are lawful and precise. Under Section 4 of the Companies Act, 2013, the MoA must be signed by all initial subscribers in the presence of a witness.
Articles of Association (AoA): The AoA lays down the company’s internal rules and regulations. It governs the roles and responsibilities of directors, management procedures, and the rights of shareholders.
The AoA must be drafted in compliance with the provisions of the Companies Act, 2013, and signed by the subscribers of the company. Both the MoA and AoA are filed electronically using SPICe+ (Simplified Proforma for Incorporating a Company Electronically Plus) form on the MCA portal.
The proper drafting and submission of MoA and AoA are indispensable as they constitute core documents required for company formation in India and dictate the future operational framework of the company.
IV. Declaration by Directors and Promoters (INC-9 and DIR-2)
As part of the documents required for company formation in India, a statutory declaration must be provided by the directors and promoters of the company, ensuring compliance with the legal requirements of the Companies Act, 2013. This declaration is submitted in the form of INC-9 and DIR-2.
Form INC-9: This is a declaration by the first directors and subscribers to the Memorandum of Association. It confirms that they are not involved in any fraudulent or illegal activities, and that the company complies with the legal prerequisites for incorporation under the Companies Act, 2013. This form is submitted electronically and attested by the directors using their Digital Signature Certificate (DSC).
Form DIR-2: This is the consent form provided by the individual directors, indicating their willingness to act as directors of the proposed company. The form is accompanied by the director’s personal information, proof of identity, and proof of residence.
Both forms are mandatory documents required for company formation in India, ensuring that the directors and subscribers are legally eligible to act in their respective capacities.
V. Proof of Registered Office Address
One of the essential documents required for Company Incorporation in India is the proof of the registered office address.
Under Section 12 of the Companies Act, 2013, every company must have a registered office within 30 days of incorporation, where official correspondence and notices will be sent. For the incorporation process itself, it is crucial to submit documents that validate the company’s proposed registered office address.
The following documents are required to confirm the registered office address:
- Ownership Proof: If the premises are owned, the company must submit the property deed or sale deed.
- No-Objection Certificate (NOC): If the premises are rented, a No-Objection Certificate (NOC) from the landlord is mandatory, along with a rent agreement.
- Utility Bill: A recent utility bill (electricity bill, water bill, or property tax receipt), which should not be older than two months, must be provided as proof of the premises being in use.
This document is necessary to demonstrate that the company has a fixed, legitimate place of business in India. The address provided in these documents required for company formation in India will be used for all official communications with the Registrar of Companies (RoC) and other authorities.
VI. PAN and TAN Applications
In addition to the other documents required for company formation in India, obtaining a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) is compulsory for all companies during the incorporation process.
PAN: The Permanent Account Number, issued by the Income Tax Department, is essential for the company’s tax-related transactions. Once the company is incorporated, the PAN is automatically allotted by the MCA through the SPICe+ form, and the physical PAN card is issued subsequently. The company must submit PAN details in all financial and tax dealings, and failure to obtain a PAN can lead to penalties.
TAN: The Tax Deduction and Collection Account Number is required for companies that need to deduct tax at source (TDS) while making payments such as salaries, contracts, or professional fees. The TAN application is also processed via the SPICe+ form during incorporation, and it is mandatory for every company engaging in such transactions to have TAN.
Both the PAN and TAN are vital tax-related documents required for company formation in India, without which a company cannot legally operate or comply with taxation laws.
Ensuring that the PAN and TAN applications are properly filed and obtained is a critical step in the incorporation process, helping the company stay compliant with Indian tax regulations.
VII. SPICe+ (Simplified Proforma for Incorporating a Company Electronically Plus) Form
The SPICe+ form, introduced by the Ministry of Corporate Affairs, is a comprehensive e-form that simplifies the incorporation process by consolidating multiple services in one application. This form is central to the documents required for company formation in India and includes:
- Company incorporation
- DIN allotment
- PAN and TAN application
- GST registration (optional)
- ESIC (Employees’ State Insurance Corporation) and EPFO (Employees’ Provident Fund Organization) registration
- Opening a company’s bank account
The SPICe+ form is divided into two parts:
- Part A: For name reservation (as discussed in earlier sections).
- Part B: For all other incorporation services, such as company registration, DIN allotment, and the aforementioned registrations.
Once all the required documents, such as MoA, AoA, proof of address, and identity documents of directors, are uploaded, the SPICe+ form can be submitted through the MCA portal.
After successful verification and approval, the Certificate of Incorporation (CoI) is issued by the Registrar of Companies (RoC), which legally signifies the company’s existence. This certificate must be preserved and referenced for all future official activities.
The SPICe+ form’s integration of multiple services into a single platform streamlines the process and reduces the paperwork burden for entrepreneurs. Filing the SPICe+ form with accurate documents required for company formation in India ensures legal compliance and efficient processing of the incorporation application.
VIII. Certificate of Incorporation (CoI)
Once all the necessary documents required for company formation in India are submitted, verified and approved, the company receives the Certificate of Incorporation (CoI) from the Registrar of Companies (RoC).
This certificate is the final document in the incorporation process and signifies the legal existence of the company.
The Certificate of Incorporation (CoI) contains the following details:
- The company’s Corporate Identity Number (CIN)
- The date of incorporation
- The name of the company
- The registered office address
- A digital signature of the RoC
The CoI serves as evidence that the company has been formed in accordance with the provisions of the Companies Act, 2013, and it marks the formal recognition of the company as a legal entity. Once issued, the CoI allows the company to commence its business operations and avail of the rights conferred to it by law.
It is important to note that the CoI is a critical legal document, and it must be carefully maintained as part of the permanent documents for company formation in India. Any misrepresentation or discrepancy in the information provided during incorporation could result in penalties, fines, or even the cancellation of the CoI by the authorities.
With the CoI in hand, the company can now engage in business activities, enter into contracts, and operate in accordance with the rules set forth in the Companies Act, 2013.
Conclusion
In conclusion, the incorporation of a company in India is a meticulously regulated process, with specific documents required for company formation in India as mandated by the Companies Act, 2013. Compliance with these statutory requirements is non-negotiable, as each document serves a critical function in ensuring legal transparency, operational legitimacy, and corporate governance.
Any deviation or oversight in the submission of these documents can result in legal repercussions, underscoring the importance of adhering to the prescribed statutory obligations. Thus, navigating the incorporation process with precision and legal conformity is imperative for the smooth functioning of any corporate entity in India.
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FAQs
1. What is the primary legislation governing company formation in India?
The primary legislation governing company formation in India is the Companies Act, 2013. This Act provides the regulatory framework for the incorporation, governance and dissolution of companies.
2. What are the mandatory documents required for company formation in India?
The mandatory documents required for company formation in India include:
- Director Identification Number (DIN) and Digital Signature Certificate (DSC)
- Memorandum of Association (MoA) and Articles of Association (AoA)
- Declaration by Directors and Promoters (Form INC-9 and DIR-2)
- Proof of Registered Office Address
- Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN)
- SPICe+ form for incorporation.
3. How can I reserve a company name in India?
To reserve a company name in India, you can use the RUN (Reserve Unique Name) application available on the Ministry of Corporate Affairs (MCA) portal. You must provide two name options and a brief description of the business activity. The chosen name will be reserved for 20 days upon approval.
4. What is the role of the SPICe+ form in the incorporation process?
The SPICe+ form simplifies the company incorporation process by consolidating multiple services, including company registration, DIN allotment, PAN and TAN application, and optional registrations like GST. It streamlines the submission of required documents through the MCA portal.
5. What is the significance of the Certificate of Incorporation (CoI)?
The Certificate of Incorporation (CoI) is the final document issued by the Registrar of Companies (RoC) upon successful incorporation. It signifies the legal existence of the company, contains important details like the Corporate Identity Number (CIN) and registered office address, and allows the company to commence business operations legally.
