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Company Incorporation

The incorporation of any company has to be carried out according to the Companies Act. It is the basic statute established by the Government of India to carry out all the companies’ related affairs. Section 2, clause (20) of the Companies Act, 2013 has defined the term ‘company’ as “a company incorporated under this Act or under any previous company law”. It simply means that the incorporation of any company in India has to be according to the guidelines established under this Act. At the same time, there are also a lot of unregistered companies functioning, but the credibility of any company not registered under this Act is always questioned. 

What is the incorporation of a company?

Incorporation basically means giving a company its own separate legal identity. In laymen’s terms, it is a legal process to convert a company into an individual legal person. Company incorporation therefore can be defined as a process of constituting a company and thus converting it into a legal corporation. By incorporating a company, all the natural legal rights a person holds are acquired by the said company. It means that the company, like a person, can be sued or can sue; it can sign contracts, buy and sell property on its own and much more. The legal capacity of the company thus widens, making it a “juristic person” under the Companies Act. 

Why is it beneficial to incorporate a company?

Other than the acquisition of natural legal rights, there are other benefits as well. For instance, after incorporation, the company acquires “perpetual succession”, which means that unless and until it is dissolved legally, the said company cannot cease to exist. The death or departure of any member cannot affect its existence.

Company incorporation also creates a limited liability towards its members regarding the debts of the company, unless there is a contractual agreement for unlimited liability, the terms and conditions can vary the liability of the members. The incorporation also settles down the issue of transformation of ownership and shares whenever there is a death or departure of any member. Benefits on tax, borrowing capacity, management ability and much more can be achieved once the company is incorporated.

The incorporation of a company definitely helps your business grow. We at YouTax have a team of financial experts who will consult you regarding the incorporation of your company. YouTax will not only help you understand the whole process but will conduct incorporation for you in a fast and hassle-free manner. All you have to do is reach out to us at our contact number +(91) 8421447373 or visit our website youtax.in.

Types of companies that get incorporated

Following are a few types of companies to get incorporated in India:

Public Limited Companies: 
Those companies are publicly traded and are usually owned by the stockholders, who are members of the general public. A minimum of seven members are required to establish such a company.

Private Limited Company:
Those companies are privately owned by a few individuals. Such companies are not publicly traded. A minimum of two members are required to establish such a company unless it is an OPC.

One-Person Company (OPC): 
The government has provided an option of a “One Person Company” for those individuals who wish to own the company by themselves and no one else. It falls under the domain of a private company that is owned by one single person.

How to get the company incorporated?

The procedure of getting a company incorporated is easy yet complex. To briefly summarize, the company has to be registered by the said promotor in the government agency named Registrar of Company (ROC). The said promotor has to file an INC 32 form with certain attachments like MOA, AOA, and other documents. Once the form is filed and approved by the ROC, a certificate of incorporation and CIN number is generated by the ROC for the said company, which is proof that the said company has come into existence formally. The incorporation of the company thus creates credibility for the said company.

We at YouTax help you register your company rapidly by making the whole process understandable and convenient. Our experts are professional and experienced in all tax-related and financial services, so all you have to do is connect with us via +(91) 8421447373 or visit our website youtax.in for the best taxation and financial-related consultation.