Below are the essential factors in one should refer while running a business in India. This checklist will definitely help the business people and entrepreneurs while starting and running a business.
Registering A Company
An Indian company is registered by first filling in an INC-1 Form. The incorporation of a company is governed by the Companies Act, 1956. It is a very important part of legislation and empowers the Central Government to oversee the formation, financing, running and winding of companies. Note that there is a separate set of procedures for registration of different kinds of business organisations.
Registered Office Of A Company
A registered office is the official address of an incorporated company, corporation or any other legal entity. All registered Indian Companies are required to have a registered office address.
Change Of Address For The Registered Office
If a company decides to change its registered office address after its incorporation, the new address must be notified to the Registrar of Companies within 30 days of its change.
MOA (Memorandum of Association)
A memorandum of Association is an important document that regulates a company’s activities. The MOA gives the company’s name, names of its shareholders/Members and number of shares held by them, and location of its registered office. It also states the following:
Objective Of The Company
- Amount of authorized capital,
- Whether liability of its members is limited by shares or by a guaranty
- What type of contracts the company is allowed to enter into.
AOA (Article of Association)
In corporate governance, a company’s article of association (also called articles of incorporation) is a document which, along with the memorandum of association forms the company’s foundation. It defines the responsibilities of the directors, the kind of business to be undertaken, and the means by which the shareholders exert control over the board of directors. (Source: wiki)
Company Name Change
Choose the name of your company carefully, as once the name is registered, it is oftentimes expensive to change it to another name. In order to change the company name, fill out Form INC-1. This is the process of filing the name pending approval. After the name gets approved, the applicant is required to file form MGT-14 (necessary resolution for the alteration of MOA and AOA) and form INC-24 to give effect to change in name. (www.mca.gov.in)
Directors of the Company
Every public company must have at least three directors. Other companies must have at least two directors. The directors of a company jointly are referred to as the “Board of directors”. Only individuals can be appointed as directors. Under the Companies Act, an entity like a corporate, an association or firm cannot be appointed director of a Company.
Removal Of A Director
A company may, under certain circumstances, remove a director before the expiry of his period of office. On receipt of notice of a resolution to remove a director, the company should send a copy to the director concerned, and the director shall be entitled to be heard on the resolution at the meeting.
Authorised Capital For The Company
The authorised capital of a company—also referred to as the authorised share capital, registered capital or nominal capital—is the maximum amount of share capital that the company is authorised by its constitutional documents to issue to its shareholders.
Digital Signature Certificate
A Digital Signature Certificate (DSC) is the virtual equivalent of physical certificates. For example, a drivers’ license or passport is a physical certificate. These 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 for a certain purpose or to sign certain documents digitally; e-forms are required to be signed digitally using a Digital Signature Certificate.