Public Limited Company Registration Fees in India
Public Limited Company Registration Fees in India
The cost of registration of a sole proprietor company is nearly Rs 2,500 while that of a partnership firm is nearly Rs 5,000. If you incorporate a private (LLP or LLC) company with a minimum authorized capital of Rs 1,00,000, the registration will cost you Rs 7,000.
- The Public Limited company registration fees for organizations whose nominal share capital is limited to Rs. 1,00,000 – Rs 5,000.
- The registration fee for organizations whose nominal share capital ranges between Rs. 1,00,000 to Rs. 5,00,000 – Rs. 5,000. Rs. 400 will be added for every Rs. 10,000 or part thereof of nominal share capital.
- The registration fee for organizations whose nominal share capital ranges between Rs. 5,00,000 to Rs. 50,00,000 – Rs 21,000. Rs. 300 will be added for every Rs. 10,000 or part thereof of nominal share capital.
- The registration fee for organizations whose nominal share capital ranges between Rs. 50,00,000 to Rs. one crore – Rs 2,06,000. Rs. 100 will be added for every Rs. 10,000 or part thereof of nominal share capital.
- The registration fee for organizations whose nominal share capital exceeds Rs. one crore – Rs 2,06,000. Rs. 75 will be added for every Rs. 10,000 or part thereof of nominal share capital subject to a maximum of Rs. 2.50 crores.
What is Public Limited Company Registration?
As per section 2(71) of the Companies Act, 2013 public limited company registration means it is not a private company. The Public limited company registration fees for organizations whose nominal share capital is limited. Any subsidiary private company of a public company is also considered a public company. Any Public company should have at least 7 members and no limit for maximum members and should have at least 3 Directors. A Public Company is required to comply with more strict compliances as compared to a private company. The public company has the right to transfer its shares to any person whether it is outside and can also subscribe to shares from the public.
Who Can Start a Public Limited Company in India?
In India, a public limited company can be started by any person or group of people who are interested in forming a company and complying with the legal requirements.
The following are the requirements to start a public company in India:
- A Minimum Number of Members: A public company must have a minimum of seven members.
- Directors: A public company must have a minimum of three directors. At least one director must be a resident of India.
- Name Reservation: The proposed name of the company must be reserved with the Ministry of Corporate Affairs (MCA).
- DSC: The directors must obtain a digital signature certificate (DSC) from a licensed certifying agency.
- DIN: Each director must obtain a Director Identification Number (DIN) from the MCA.
- The MOA and AOA: Memorandum of Association (MOA) and Articles of Association (AOA)must be drafted and filed with the Registrar of Companies (ROC).
- Payment of Fees: The prescribed fees must be paid to the ROC.
- Certificate of Incorporation: Once all the formalities are completed, the ROC will issue a Certificate of Incorporation, and the company will be deemed to be registered.
Benefits of Registering a Public Company
- A public limited company is regarded as a separate legal entity from its stockholders. The public limited company might have its own PAN, bank account, approvals, contracts, licenses, assets, and obligations.
- A public limited business receives capital from both individuals and financial institutions. The funds can also be raised through stock shares, preference shares, or debentures.
- One of the greatest advantages of a Public Limited Corporation is that shareholders can simply transfer their shares to other legal entities, whether they are individuals or organizations in India or outside. Also, the company’s director can be replaced to ensure its longevity.
- The investors of a Public Limited Corporation are provided with limited liability protection. In the event of an unanticipated liability, the corporation alone would be liable and the shareholders would be unaffected.
- As the organization has a large capital base, the development potential is also substantial, particularly in the case of a public company.
- The Board of Directors controls the organization’s administration. Investors are responsible for electing this Board of Directors.
How to Register a Public Limited Company in India?
Public limited company registration in India requires 7 persons to start. No minimum capital requirement is there, one can start with even Rs.5,000. Here are following three important points:
1) Prepare DSC and file Name Approval:
The first step is to prepare DSC and DIN. This takes some time one to two days. Thereafter, you need to file for name approval. The first word of the name should be unique and the name should end with the words “Limited.”
2) File for Incorporation:
After taking name approval, the next step is to file for incorporation via spice form INC 32. Further, PAN and TAN are not required to be filed separately and the same is allotted on company formation.
3) Take GST Registration:
After incorporation, access your business and take necessary registration including GST registration. This is because working without a tax license is illegal in India.
Document Required to Start a Public Company:
- Utility bill of registered office not older than 2 months.
- Bank statement of all subscribers and directors for their residential proof, further It should not be older than 2 months
- Aadhar card, and PAN card of all subscribers and directors in a legible format.
- Rent agreement for registered office (if rented).
- No objection certificate from the owner of the registered office.
- Driving license of all subscribers and directors for identity proof.
Post-Incorporation Compliance for Public Company
Once a public company is registered in India, there are certain mandatory compliances that the company must follow on an ongoing basis. Some of the key compliances are:
- Holding Annual General Meetings (AGMs): The company must hold an AGM every year, where the shareholders are updated on the company’s performance, financials, and other important matters.
- Filing Annual Returns: The company must file its annual returns with the Registrar of Companies (ROC) within 60 days of the AGM. This includes the financial statements, director’s report, and other statutory documents.
- Filing Financial Statements: The company must file its financial statements with the ROC within 30 days of the AGM. This includes the balance sheet, profit and loss account, and cash flow statement.
- Maintaining Statutory Registers: The company must maintain various registers, such as the Register of Members, Register of Directors, and Register of Charges, as per the Companies Act.
- Appointment of Auditors: The company must appoint an auditor within 30 days of incorporation and at every AGM to audit the company’s financial statements.
- Disclosure of Director’s Interest: The directors of the company must disclose their interest in any contracts or transactions with the company.
- Complying with Corporate Social Responsibility (CSR) Requirements: Public companies with a certain level of turnover and net profit are required to spend a certain percentage of their profits on CSR activities.
Private Limited Company vs Public Limited Company
The main difference between a private limited (Pvt Ltd) company and a public limited (Public Ltd) company are listed below:
- Ownership: A Pvt Ltd company is privately owned and cannot have more than 200 shareholders, while a Public Ltd company can have an unlimited number of shareholders and the shares can be traded on the stock exchange.
- Share Transferability: The shares of a Pvt Ltd company cannot be freely transferred, and the company must approve any share transfers. In contrast, the shares of a Public Ltd company can be freely bought and sold on the stock exchange.
- Disclosure Requirements: A Pvt Ltd company has fewer disclosure requirements than a Public Ltd company. For example, Pvt Ltd companies are not required to disclose their financial statements publicly, whereas Public Ltd companies are required to file their financial statements with the Registrar of Companies and make them available to the public.
- Minimum Capital Requirement: A Pvt Ltd company can be incorporated with a minimum paid-up capital of Rs. 1 lakh, whereas a Public Ltd company, must have a minimum paid-up capital of Rs. 5 lakhs.
- Legal Compliances: A Public Ltd company has more legal compliances and regulations to follow than a Pvt Ltd company. For example, a Public Ltd company must hold an Annual General Meeting (AGM) and comply with various other requirements under the Companies Act.
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FAQs on Public Limited Company
A Public Limited Company (PLC) is a type of company structure that is publicly traded on a stock exchange, and which can offer its shares to the public. A public company is a legal entity that is separate from its shareholders and can raise funds by issuing shares and debentures to the public.
In a Public Limited Company, the ownership is shared among the shareholders, who have limited liability for the company's debts. This means that the personal assets of the shareholders are protected if the company is unable to pay its debts.
The application for Digital Signature Certificate (DSC) for such companies is filed through the online portal, and the shareholders and directors of the company should sign it. The issuing of DSC needs some mandatory documents like address proof and identity proof associated with some photographs.
DIN is a short form of Director Identification Number and it is issued by the Registration of the Companies ROC which permits the director to work in the company.
MOA is a short form of Memorandum of Association and it defines the business object, mission, and vision of the company before its incorporation while AOA is a short form of Article of Association. It represents the internal constitution of the company.
A public limited company needed a minimum capital of Rs. 5, 00,000. This amount is required to deposit by the director or shareholder in the determined share percentage in the bank account of the public Limited Company. Then the same deposit amount can be utilized by the company for its further operations.
Generally, it takes 8-15 Working Days for the registration process of a company, moreover, it is a legal process, and fixing a timeline is not practical, Start-ups are advised to plan the registration process in advance before the launch date of their company.
Spice refers to the electronic Simplified Proforma for Incorporating Company, which provides a single window for several applications within a single form. Together with the application for business registration, an applicant receives DIN numbers for up to three directors, PAN, TAN, registration under EPF, ESIC, Professional Tax, GST, and the company's bank account number.
The first and foremost step in obtaining Public Limited Company Registration is to reserve and get approved for the name of the company. The proposed or reserved name should not hold any word which is prohibited as per the Companies Act, 2013.
The Cost to register a Private Limited Company in India/ Registration of Pvt Ltd Company would vary from INR 6,000/- to INR 30,000/- depending upon the No. of Directors, No. of members, authorized share capital and Professional fees. Professional fees may depend upon the complexity of the task.
Taxpayers should be aware that there are no registration fees for the GST. As a result, there is no fee associated with GST registration. Nonetheless, there will be a GST penalty if you pay your taxes late or insufficiently.