Nowadays incorporating a Private limited company is a very popular way to commence a business. It is very simple to form a Private Limited Company! Let’s understand what Private Limited Company is, its features and benefits of forming it.

1. A Private Limited Company is a form of business enterprise which is privately held by small group of people. The capital is invested in the form of “shares” and person holding shares is called as member. A private limited company is governed by Companies Act, 2013. Minimum two members are required to start a private limited company while the ceiling limit on maximum number of members is two hundred. There must be minimum two directors and maximum 15 directors for a private limited company.
2. The key feature of Private Limited Company is that liability of members of a private limited company is limited to the number of shares held by them. If a private limited company faces financial risk, its shareholders are not liable to sell their personal assets i.e. they have limited liability. Their personal assets are not at risk in case of liquidation of company.
3. There are certain restrictions on transfer of shares in case of Private limited company. Shares of Private Limited Company are not publicly traded. Private Limited Company cannot accept deposit from public at large

1. Separate Legal Existence: Private Limited Company is a separate legal entity. The existence of Private Limited Company is not affected by death, insolvency or bankruptcy of any of its members. The life of Private Limited Company is perpetual.
2. Limited Liability of Members (Shareholders): The liability of members of Private Limited Company is limited to extent of nominal value of shares held by them. The limited liability feature is one of the biggest advantages of forming Private Limited Company. While a shareholder can participate wholly in the growth of a company, his or her liability is restricted to the amount of the investment in the company, even if company subsequently goes bankrupt and has remaining debt obligations.
3. No Minimum Capital Requirement: There is no condition of minimum share capital to register a Private Limited Company. It can be started with any amount.
4. No deposits from Public: Private Limited Company is not allowed to accept to deposit or loan from persons other than its members, directors or their relatives.
5. Name: The Private Limited Company is required to add words “Private Limited Company” at the end of its name.

1. Perfect option for external Funding: The Private Limited Company offers various funding options in form of private equity, ESOP and more. This makes it more convenient for external funding options. Therefore Venture Capitalists, Angel Investors, and other outside funding agencies prefer Private Limited Company for their investment compared to any other business forms.
2. Tax Saver: The Private Limited Company is taxed at the rate of 25% if the turnover of Private Limited Company during the financial year 2018-19 does not exceed 400 crores whereas highest tax slab for individual is 30% ( in case income exceeds Rs 10 Lakhs).
3. Limited Liability of Members: The main advantage of forming a Private Limited Company is that Liability of members is limited which means assets attributed to the members cannot be seized in an effort to repay debt obligations attributed to the company.
4. Perpetual Existence: The existence of Private Limited Company remains unaffected by death, insolvency or bankruptcy of its members. It lasts forever unless and until it is dissolved.
5. Name: The Private Limited Company is required to add words “Private Limited Company” at the end of its name.
6. Benefit of Start-up India Scheme: The Private Limited Company is eligible to take benefit of registration under Startup India Scheme of Government of India. This scheme has various benefits including tax exemptions for the recognized startups.

As per the Companies Act,2013, Public company means a company which
1. is not a private company;
2. has a minimum paid-up share capital may be prescribed
Provided that a company which is a subsidiary of a company, not being a private company, shall be deemed to be public company for the purposes of this Act even where such subsidiary company continues to be a private company in its articles.
In general parlance, A Public Limited Company is a company that has limited liability and offers shares to the general public. It’s stock can be acquired by anyone, either privately through (IPO) initial public offering or via trades on the stock market.

1. Directors: For Public Limited Company Registration, the company must have minimum 3 directors, 7 Shareholders and A company can appoint maximum 15 fifteen directors. A company may appoint more than fifteen directors after passing a special resolution in general meeting and approval of Central Government is not required.
2. Minimum/Maximum Members: Minimum number of shareholders is 7 and there is no limit on maximum number of shareholders unlike Private Limited Company which has an upper limit of 200.
3. Paid Up Capital: It needs minimum Paid up Capital of Rs.5 lakh or such higher amount as may be required in the act.
4. Separate Legal Identity: A company has its own identity which doesn’t affects by the death, insolvency or bankruptcy of its shareholders or directors.
5. Limited Liability: A shareholder of a public limited company isn’t personally responsible. The liabilities of the shareholders are limited. It means limited roughly to the face value of the shares they own contrary to partnerships and sole proprietorships, where the partners and business owners are jointly and severally liable for the debts of the business. Moreover, shareholders do not have to take part in the day-to-day management of the business of the company.
6. Prospectus: For a layman, it’s like an invitation card to the public for subscribing the shares of the company. There is a requirement under the Act for public limited companies to issue a prospectus. It is a formal document that is required by and filed with the Securities and Exchange Commission (SEC).It is filed for offerings of stocks, bonds, and mutual funds. The document can help investors make more informed investment decisions because it contains a host of relevant information about the investment security.
7. Name: It is a compulsory requirement under the Companies Act, 2013 for all the public companies to add the word ‘limited’ after their name.
8. More Transparent: Limited companies, whether public or private, have more of their details in the public domain, available via Companies House, than other business types. The fuller form of accounts means a public limited company has to disclose more detailed data about the business and its performance, information which is then available to anyone who wishes to access it.

1. Huge Capital: The Public limited company has the feature of huge magnitude of capital than that of the Private limited company.
2. No Limit on Shareholders: There can be any no. of shareholders in a public limited hence enabling huge investment through public.
3. Risk Dilution: Offering shares to the public gives the opportunity to spread the risk of company ownership among a large number of shareholders.
4. Transferability of Shares: Shareholders are entitled to transfer their shares freely without needing the consent of someone.
5. Finance Opportunities: A public limited company is always in a better position when looking at other potential sources of finance. Being listed on a stock exchange can helps to improve a company’s creditworthiness thus increasing the willingness of Banks and other financial institutions to provide more finances. A company can also negotiate better for favorable interest rates and repayment terms on loans.
6. Growth Opportunities: By having more finance, more readily available and on better terms than a private company, the public limited company can be in an advantaged position to: Pursue new projects, new products or new markets, can make capital expenditure to support and enhance the business and can grow substantially.

1. Copy of PAN Card of directors
2. Passport size photograph of directors
3. Copy of Aadhaar Card/ Voter identity card
4. Copy of Rent agreement (If rented property)
5. Electricity/ Water bill (Business Place)
6. Copy of Property papers (If owned property)
7. Landlord NOC
8. Director Identification Number (DIN) of all the directors
9. Digital Signature Certificate (DSC) of the directors
10. Memorandum of Association (MOA)
11. Articles of association (AOA)

It is said that “A One Person Company is a complete shift in the Indian corporate regime, bringing it at par with global standards.” An OPC is unique wherein it combines most of the benefits of a proprietorship and a company from of business. Thus, it does away with the difficulties of finding the right people to collab with, to start your own company.
As per section 3(1)(c) of the Companies Act, 2013, an OPC may be formed for any lawful purpose by one person being a citizen of India.
As per provision of section 2(62) of the Companies Act, 2013 defined (62) “one-person company” means a company which has only one person as a member.
For the formation of OPC – Only a natural person who is an Indian citizen and resident in India­­-
1. shall be eligible to incorporate a One Person Company;
2. shall be a nominee for the sole member of a One Person Company.
the term “resident in India” means a person who has stayed in India for a period of not less than 182 days during the immediately preceding one financial year.

The whole idea of One Person Company is to promote the incorporation of micro-businesses and persons with corporate level ideas to provide uplift to entrepreneurs who have high potential to start their own venture by allowing them to create one-person company.
The OPC is appropriate for tiny businesses wherever the turnover isn’t possible to cross Rs. 2 Crores.
1. Members: There can be only one member at a time. However, one nominee is mandatory to be appointed. This member and nominee cannot be a minor.
2. Directors: Can have more than 1 directors, but the shareholder cannot be more than 1.The company may have a maximum of 15 directors (As per the companies act, if nothing is mentioned in the incorporation document, it would be assumed that the sole shareholder shall also be the sole director in the OPC and which shall be particularly the case in most OPC incorporated).
3. Paid Up Capital: Minimum authorized share capital required for One Person Company having share capital is Rs.1,00,000/-. But If an OPC crosses a turnover of over Rs. 2 crores or has a paid-up capital more than Rs 50 lakhs. It must be converted into a private or public within 6 months.
4. Name: OPC company needs to get itself registered as a private limited company. It is a compulsory requirement under the Companies Act, 2013 for all the private companies to add the word ‘limited’ after their name. The words ‘One Person Company’ must be mentioned below the name of the company, wherever the name is affixed, used or engraved.
5. No deposits from Public: Just like Private Limited Company, OPC is also not allowed to accept deposit or loan from persons other than its member, directors or their relatives.

1. Easy to Operate: OPC is 1 of the easiest forms of corporate entities to operate. Very few ROC filings are to be registered with the Registrar of Companies. No need to handle Annual General Meeting and other regular compliances.
2. Limited Liability: The directors’ personal property is forever safe in no matter the debts of the business. In OPC only investment in the company is lost, personal assets of the directors are saved. It means limited roughly to the face value of the shares they own contrary to partnerships and sole proprietorships, where the partners and business owners are jointly and severally liable for the debts of the business
3. Continuous Existence: A company has its own identity which doesn’t affects by the death, insolvency or bankruptcy of its shareholders or directors. It would pass on to the nominee director, therefore, it has continued existence.
4. Full Control over the Company with a Single Owner: This fact helps in fast decision making and execution. Yet OPC can select as many as 15 directors for official functions, without providing any share to them.
5. Greater Credibility: An OPC requires to have its books audited yearly, it has higher credibility between vendors and lending institutions.
6. Easy to raise funds and loans: With higher credibility comes, higher finance opportunities, thus enabling it to raise funds and loans easily as compared to proprietorship form of business.

1. Copy of PAN Card of director
2. Passport size photograph of director
3. Copy of Aadhaar Card/ Voter identity card
4. Copy of Rent agreement (If rented property)
5. Electricity/ Water bill (Business Place)
6. Copy of Property papers (If owned property)
7. Landlord NOC
8. Director Identification Number (DIN) of all the directors
9. Digital Signature Certificate (DSC) of all the directors
10. Memorandum of Association (MOA)
11. Articles of Association (AOA)
12. Consent letter of Nominee