Private Limited Company


A Private limited company is a perfect start for anyone who wants to start their business to give it a separate legal identity. Private limited company can be formed with ease and its procedural compliance is also easy when compared to that of a public company. This means that a company continues to exist even after the death of any member. A private company in India can consist of a maximum of 200 members at a time. In a Private Limited Company, the shareholders are considered to be the owners of the company and the directors are responsible for the everyday operations of the business. This ensures that the personal assets of the shareholders and directors are separate from that of the company.

Private Limited Company registration is regulated by the Companies Act, 2013 in India and the Ministry of Corporate Affairs acts as the regulatory body. To register a Private Limited Company in India, there must be at least 2 directors and 2 shareholders. The most important feature of a Private Limited Company is that it is the most favoured form of business structure by investors as it limits the liability of the investors only to the investment they have made in the company.

Private Limited Company vs. LLP

The Private Limited Company and Limited Liability Partnership both are limited liability structures in business. However, the companies offer certain key advantages, especially for startups. Ownership of the company is defined by share capital, which is easy to transfer compared to ownership transfer in LLP. Also, it clearly differentiates management and ownership. However, one should also consider higher compliance and mandatory audit requirement, making it an expensive structure to maintain.

Characteristics of Private Limited Company

Separate Legal Existence

Once the Company registration in India is done, a legal entity is born in eyes of law. This separates itself from its owners and managers. The company can operate on its own name simply by opening a bank account to own assets and enter into contract with parties. This also provides right to sue third parties in case of any defaults.


To start a company, a minimum number of 2 members are required and a maximum number of 200 members as per the provisions of the companies act 2013.

Deposits cannot be accepted

Company cannot appeal for money from the public .There are also some restrictions on the sale or transfer of its shares by the shareholders.

Fund Raising Capacity

It is the only form of business other than public limited company to raise fund from the Venture Capitalist or Angel investors. It cannot go to public like other big companies.

Minimum Capital Contribution

There is no minimum capital amount for a company. A company should have an authorized capital of at least Rs. 1 lakh.

Protection Against Liabilities

If the company became insolvent the investment in the company would be lost but the shareholders would not be pursued for any shortfall to pay creditors unless they were proved to have acted recklessly.

Limited Liability

This is perhaps the most important feature of Private Limited Company. Imagine a scenario, where someone filed a claim against you more than your business assets. In such a case, your personal assets can also be bought and sold to pay the debt.

Number of Directors

As per the Act of 2013, a Private Limited Company needs to have at least 2 directors. Although they are not required to appoint any independent directors.

Minimum subscription

Company receives the amount which is 90% of the shares issued within a certain period of time. In case the company if the company is not able to receive 90% of the amount then they cannot commence further business.


checklist legal angadi

Documents and Details Required for Registration

  • PAN card- All Directors
  • ID Proof (Aadhar card/DL/Voter ID) of all Directors
  • Permanent address Proof (Bank Passbook-front page/Latest utility bill)- All Directors
  • Address Proof of proposed Registered Office of company
    • If taken on rent then NOC with the utility bill from the owner
    • If not taken on rent or owned by any other entity then NOC signed by an owner
    • If owned by Director then sale deed with an electricity bill
  • Passport size photograph of all directors
  • Main objects of the proposed company in detail
  • Four names of the proposed company as per preference
  • Significance of names of the proposed company
  • Shareholding proportion
  • Signed forms (Format provided)

Selection of name for your LLP

The Registrar of Companies (RoC) has issued guidelines for Limited Liability Partnership to name the business. It is essential that to follow the rules closely or your application may end up getting rejected, leading to a much longer process.

Be Unique

In Cloudtail India Private Limited, Cloudtail is the unique component. Now, once taken, the name will not be given to any other business in categories related to the business.


Abbreviations, adjectives and generic words are rejected. So XYZ would be rejected, as would Good Quality Biscuits. The words bank, exchange and stock exchange, unless approved by RBI or SEBI, would also be rejected.

No Common Trademark

There should not be a registered trademark by the same name on the Intellectual Property Register. If there is one, the name can only be approved if you are able to get a No-Objection Certificate from its owner authorizing you to use it. Otherwise the applicant has to select new name.

Descriptive things

In XYZ Foods Private Limited, the word ‘Foods’ describes the business the company is into. You cannot have ‘Foods’ in your name if you’re, say, in the logistics or services business.

How to Register Private Limited Company?

Company Registration in India will boost the progress of startups and provide an additional edge over those who have not registered. The Ministry of Corporate Affairs governs the company registration process with rules and regulations framed in accordance with the law.

Step 1: Application for DSC (Digital Signature Certificate).

Step 2: Apply for the DIN (Director Identification Number)

Step 3: Application for the name availability.

Step 4: Filing of the eMOM and eAOA to register private limited company

Step 5: Apply for the PAN and TAN of the company

Step 6: Issued certificate of incorporation by RoC with PAN and TAN

Step 7: Opening a current bank account on company name

What we help in Registering the Company?

 The Private Limited Company Registration process is completely online, so you don’t even have to leave your home to get your entity registered.

Company Registration package includes:

  • DIN and DSC for two Directors
  • Drafting of MoA & AoA
  • Registration fees and stamp duty
  • Company Incorporation Certificate
  • Company PAN and TAN
  • Current Account