Private Limited or Public Limited Company is the best choice to start a business in India. Companies have many advantages like limited liability, separate legal entity etc. Type of company i.e. Private Limited or Public Limited can be selected according to the number of members and volume of business.
Steps and Documents requirement for Registration of a Company by a Foreigner in India
The first step to register a company is to apply for approval of name. But before applying for name approval, the following conditions are to be fulfilled.
Application for allotment of Director Identification Number (DIN)
The Indian Companies (Amendment) Act, 2006 introduced the concept of Director Identification Number (DIN) and inserted Section 266A to 266G. As per these sections, all existing Directors and those who intend to become Director are required are required to apply for DIN in the Prescribed Form DIN-1.
Proof of Identity of Indian Nationals to apply of DIN
For Indian Nationals the following documents can be used as proof of identity
Income Tax PAN is mandatory requirement for proof of identity
The proof of identity should also contain the Date of Birth of the applicant and the same should match the Date of Birth filled in the application form. In case the proof of identity does not indicate the Date of birth then additional proof of Date of Birth duly certified or attested should be attached with the DIN Application form.
Proof of Residence of Indian Nationals to apply for DIN
Address proof like Passport, Driving Licence, Election (Voter Identity) Card, Ration Card, Electricity Bill, Telephone Bill or Bank account statement in the name of the applicant should be attached with DIN-1 application form.
In case of Indian applicants, the proof of address should not be older than 2 months from the date of filing the application.
Translation of proofs in other languages than Hindi or English
The Proofs should be translated to Hindi or English from professional translator carrying his details like name, signature, address and seal. In case of Foreign Nationals, translation done by the notary of home country is also acceptable.
Affidavit by the Applicant
An Affidavit executed on non judicial stamp paper duly notarized is to be attached with the application form. It is a mandatory requirement.
Register Digital Signature Certificate (DSC)
All filings done under MCA21 e-Governance Programme are required to be filled with the use of Digital Signatures by the person authorized to sign the documents. A licensed Certifying Authority (CA) issues the digital signature.
Documents required to acquire Digital Signature Certificate (DSC)
The following details are necessary to apply for Digital Signature Certificate (DSC)
Copy of Passport or Driving Licence or copy of PAN card or copy of Provident Fund account
Latest Telephone Bill or Electricity bill or LIC policy Receipt
Copy of PAN Card
Documents required to be attached with form No. 18
The following documents needs to be attached with form No. 18
i. Proof of Registered office address - Mandatory in all cases
ii. No objection certificate from Director-Mandatory if registered office is owned by director and not taken on lease
iii. A proof that the Company is permitted to use the address as the registered office of the company -Mandatory if registered office is owned by any other entity or person (not taken on lease by the company)
iv. Any other information can be provided as an optional attachment.
If abovementioned documents like ID Proof, Address proof of individual, documents related to address of the proposed company etc are available one can start the process of registering company with the help of a Practicing Company Secretary or other professional approved by MCA.
Licence requirement to run a business in India
The licence requirement will depend on the nature of business to be done. E.g. to start export business, IEC code is compulsory.
Penalty under Income Tax Act 1961: Sections 158BFA(2)221(1), 271(1)(b), 271(1)(c), 271(1)(d), 271(4), 271A, 271AA, 271AAA, 271B, 271C, 271CA, 271D, 271E, 271F, 271FA, 271FB, 271G, 272A(1), 272A(2), 272AA, 272B, 272BB