FORMATION OF A

COMPANY
(COMPANIES ACT
2013)
 INTRODUCTION
 The Companies Act, 2013 lay down the rule for the
incorporation of both Public and Private
 A company to be incorporated as a Private Company
must have a minimum paid-up capital of Rs. 1, 00,000,
and minimum number of members required to form a
private company is 2 or more members.
 For Public Company it must have a minimum paid-up
capital of Rs. 5, 00,000 and requires at least 7 or more
members.
 1. Select Name of Person
 Under Section-149(1) (a) of Companies Act, 2013. Select
the name of directors i.e. who will be directors (At least
Three Name for Public Company and Two for Private
Company) [Rule-17] (The Companies (Incorporation)
Rules, 2014.
 2. Apply for Digital Signature Certificate (DSC) -
 Digital Signature Certificates (DSC) are the digital equivalent
(i.e. electronic format) of physical or paper certificates.
Certificates serve as proof of identity of an individual for a
certain purpose. Likewise, a digital certificate can be presented
electronically to prove your identity, to access information or
services on the Internet or to sign certain documents digitally.
One can get DSC registered by signing MCA-21 E-forms
digitally. 

A licensed Certifying Authority (CA) issues the digital

signature. 
 3. Apply for Director Identification Number (DIN)
 It is a unique identification number allotted to the
director of the company.
 Therefore, before submission of e-form INC-1 for
reservation of name, all the Director of proposed
company must ensure that they are having DIN.
 It is only after the DIN is approved, the incorporation
documents can be filed with the Registrar.
 Form No.-DIR-3. It takes about 7 days for getting the
DIN approved, provided all proper documents are
furnished. Fees to be paid for the allotment of DIN is
Rs.500.
 3. Continued….
 Documents to be furnished for getting DIN application
are:
· Identity proof: Copy of PAN card is mandatory.
· Address proof: Copy of passport or Voter Id or Ration
card or Electricity bill or any other address proof.
· Passport size photograph (latest) in soft copy (.JPEG
format).
· Current occupation.
· Email address of applicant.
· Education qualification and contact number of
applicant.
· Verification to be signed by the applicant.
4. Filing the Proposed Name of Company For Approval to The Registrar of Companies
(ROC)-
 According to Section-4(4) of The Companies Act, 2013 person
can make an application to propose the name of the company to
be registered with such forms and manner accompanied by fees
of Rs. 1,000/- to be paid, as may be prescribed, to the
Registrar for the reservation of a name set out in the
application.
 Form No. INC.1 along with the fee as provided in the
Companies (Registration offices and fees) Rules, 2014 to the
Registrar of Companies (ROC) in the State/Union Territory in
which the company will maintain its Registered Office.

5. Drafting of Memorandum of Association (MoA) -
The MoA is the Constitution of the Company which must contain all the
fundamental information of the Company.. Therefore, it is important to draft
the MoA very carefully with properly incorporating Clauses carefully.

Drafting of Memorandum must be done in which:

· Name of the Company lasts with word “Limited” in case of a public limited
or the last words “Private Limited” in case of a private limited company.
· State in which the registered office of the company is to be situated.
· Object of the company for which it is proposed.
· Liabilities of the members of the company Limited/Unlimited.
· Mention the amount of share capital in case of company having a share
capital.
· In case of the One Person Company the name of the person who in the
event of death of the subscriber shall become the member of the company.
 6. Drafting of Articles of Association (AoA)-
 AoA which is an important document explains the operation
of the company, purpose for which Company is
incorporated along with the information for the process
of Appointment of Directors and also management of
the financial Record of the company.
 Articles of Association is a document containing all the
rules and regulations that governs the company.

.
 7. Application for Incorporation of Company-
 File the e-Form INC-7 (INC-2 in case OPC) and the following documents
with the ROC for incorporation of the Co. within a period of sixty days
from the date of intimation of reservation of name given by the
Registrar.

 The MOA and AOA of Co. duly signed by all the subscribers to the
memorandum in such manner as prescribed under the Companies
(Incorporation) Rules, 2014.

 A declaration in prescribed Form INC-8 (available in word format) by

an Advocate or CS,CMA or CA in practice, who is engaged in the
formation of the company, and by a person named in the article as a
Director, manager or secretary of the company, that all the requirements
of this Act and the Rules made thereunder and matters precedent or
incidental thereto have been complied with.
 8. Certificate of Incorporation and
allotment of Corporate Identity Number

 On satisfaction of the registrar that all the requirements have

been complied with by the Co., he will retain the documents
and register the AOA & MOA and will issue a Certificate of
Incorporation in the Form INC-11,within 7 days of the receipt
of documents.
 9. Commencement of Business
Section 11 of the Companies Act,2013 says that a company
(Earlier it was for public co. only) having share capital can not
commence any business or exercise any borrowing powers
unless it files a declaration with ROC in E-Form INC-21.

Filling of Declaration
A Company having share capital shall file the following documents
along with E-Form INC-21 with the ROC:
1) List of members of the co. with their shareholding.
2) ListMD,Directors,Manager,Secretary,CEO,CFO,Auditiors
and changes among them, if any since the date of
incorporation.
3) Consent of Auditors
4) Certified true copy of the Memorandum and Article of Association of company.

5) Copy of agreements for appointments of MD, Underwriters, Contracts etc.

entered into by the promoters before incorporation of Co.

6) Details of preliminary expense already incurred/proposed to be incurred by the Co.

7)Power of attorney to obtain the certificate of commencement of business from

ROC.

8) Certified true copy of the resolution passed by the board for approval of filling
of declaration for obtaining COB.

9) Confirmation for paid up share capital to the extent of 5lacs in case of public co.
and 1lacs in case of private co and OPC,and proof thereof.

10) In the end this declaration form shall be verified by the Company Secretary or
CA or CMA in practice.

Note: It may be noted that if this declaration(INC-21) is not filled within 180 days of
the incorporation, then ROC has the power to strike off the Co.
 9. Registered Office
 Section-12 of The Companies Act, 2013 that the company on and from the 15 days of
its incorporation and at all times thereafter, have a registered office capable of
receiving and acknowledging all communications and notices as may be
addressed to it and company shall furnish to the registrar verification of its
registered office within a period of 30 days of its incorporation in such manner as
may be prescribed.

[Rule-25]The verification of the registered office shall be filed in Form No.INC.22

along with the fee.

Nominal Share Capital Fee applicable-

· Less than 1,00,000 -Rs.200\-
· 1,00,000 to 4,99,999-Rs.300\-
· 5,00,000 to 24,99,999 -Rs.400\-
· 25,00,000 to 99,99,999-Rs.500\-
· 1,00,00,000 or more -Rs.600\-