How to Form a Company in India with New Companies Act

The first thing to take care of under the new Companies Act, 2013 is to follow a changed procedure for giving birth to a Company. This article speaks of only Public and Private Limited Companies and does not cover One Person Companies. The brief procedure to be adopted for incorporating a Company would be :

Action Points : Formation of a Public / Private Limited Company – under Companies Act, 2013
[Covered by provisions of Chapter II]

Sr No	Action Point	Requirement
01	Obtain Digital Signature Certificate (DSC)	Obtain a Digital Signature Certificate from authorized DSC issuing authority.
02	Obtain DirectorIdentification No. (DIN) [S.153]	Make Application in Form DIR-3  [Rule 9 of Chapter XI Rules]
03	Register DSC in the name of Director on MCA portal
04	Apply for Reservation of Name [S.4(4)]	Apply in Form No. INC.1 [Rule 9]. The same shall be reserved for a period of 60 days
05	Adoption of Memorandumof Association [S.4(6)]	MoA shall be in respective form as prescribed in Table A, B, C, D and E of Schedule I as may be applicable
06	Adoption of Articles of Association [S.5(6)]	MoA shall be in respective form as prescribed in Table F, G, H, I and J of Schedule I as may be applicable
07	Incorporation	File with ROC Form No. INC.7 [Rule 12 to 18] alongwith(a)   The Memorandum and Articles of the company duly signed by all subscribers; (b)   A declaration in Form No.INC.8 by an advocate or Practicing professional (CA, CS, CA) who is engaged in incorporation, and a person named in director as Director, Manager or Secretary, that all requirements related to incorporation has been complied with; (c)   an affidavit in Form No. INC.9 from each subscriber and from each person named as first director in the articles that; he is not convicted if any offence in connection with promotion, formation or management of any company, he is not been found guilty of any fraud or misfeasance or of any breach of duty to any company during preceding five years, and all the documents filed with the Registrar contain correct, complete and true  information to the best of his knowledge and belief; (d)  the address for correspondence till its registered office is established; (e)  the particulars of every subscribers along with proof of identity; (f)   the Particulars of first directors along with proof of identity; and (g)  the particulars of interests of first directors in other firms or bodies corporate along with their consent to act as directors.
08	Commencement of business [S.11]	Director should file Declaration with ROC in Form No. INC.21 [Rule 24]
09	Registered Office [S.12]	A company shall have a registered office within 15 days of Incorporation and it shall file Form No.INC.22 [Rule 25] to verify the same

Caution - Six things to start doing immediately if you own a Corporate entity in India

With effect from 01.04.2014 as per Notified section 12 of the New Companies Act 2013, every company shall comply with the following requirements:

1. Paint or affix its name and address of registered office, outside every offices of the company;
2. Get its name, address of its registered office and the Corporate Identity Number (CIN) along with telephone 
3. Number, fax number, if any, e-mail and website addresses, if any,
4. Printed in all its business letters, billheads, letter papers and in all its notices and other official publications;
5. Get its name printed on hundies, promissory notes, bills of exchange and such other documents as may be notified by Central Government from time to time.
6. Also, in case where the company has changed its name during last 2 years, it shall also print former name along with its current name under Sr. no. 1 & 2 mentioned above.

Penalty for non-compliance : Rs.1,000/- for every day during which the default continues but not exceeding Rs.1,00,000/-.  

What are the Changes in formalities to incorporate a Company?

The new rules have built in counter measures to tackle fictitious applicants from forming a company. 

This is one of the ,must know changes for the Startups in Companies Act 2013.

Below is the brief and point to point update on these changes for some one keen to form a new Company.

A. Reservation of name
An application for the reservation of a name shall be made in Form No. INC.1

B. Signing of memorandum and articles
The Memorandum and Articles of Association of the company shall be signed in the following
manner, namely:-

1. The memorandum and articles of association of the company shall be signed by each subscriber to the memorandum, who shall add his name, address, description and occupation, in the presence of at least one witness who shall attest the signature and shall likewise sign and add his name, address, description and occupation.
2. The witness who is generally a practicing professional shall state that “I witness to subscriber/subscriber(s), who has/have subscribed and signed in my presence (date and place to be given); further I have verified his or their Identity Details (ID) for their identification and satisfied myself of his/her/their identification particulars as filled in”.

C. Declaration by professionals
For the purposes of clause (b) of sub-section (1) of section 7, the declaration by an advocate, a Chartered Accountant, Cost accountant or Company Secretary in practice shall be in Form No.
INC.8.

D. Affidavit from subscribers and first directors

For the purposes of clause (c) of sub-section (1) of section 7, the affidavit shall be submitted by each of the subscribers to the memorandum and each of the first directors named in the articles in Form No.INC.9 

E. Particulars of every subscriber to be filed with the Registrar at the time of incorporation. The following particulars of every subscriber to the memorandum shall be filed with the Registrar- 

• Name (including surname or family name) and recent Photograph affixed and scan with MOA and AOA: 
• Father’s/Mother’s/ name: 
• Nationality: 
• Date of Birth: 
• Place of Birth (District and State): 
• Educational qualification: 
• Occupation: 
• Income-tax permanent account number: 
• Permanent residential address and also Present address (Time since residing at present address and address of previous residence address (es) if stay of present address is less than one year) similarly the office/business addresses; 
• Email id of Subscriber; 
• Phone No. of Subscriber; 
• Fax no. of Subscriber (optional) 
• Proof of Identity 
• If the subscriber is already a director or promoter of a company(s), the particulars relating to- 

           (i) Name of the company;
           (ii) Corporate Identity Number;
           (iii) Whether interested as a director or promoter;

• The specimen signature and latest photograph duly verified by the banker or notary shall be in the prescribed Form No.INC.10. 

F. Particulars of first directors of the company and their consent to act as such The particulars of each person mentioned in the articles as first director of the company and his interest in other firms or bodies corporate along with his consent to act as director of the company shall be filed in Form No.DIR.12

Would this impact the companies already under incorporation?
In our view, it will impact. The registrar of Companies would demand for the documents and witnesses even in those cases. Certain forms for approval may be considered in transition if already filed before this comes into force.