How to Incorporate a Company

Private Limited Company Incorporation Procedure

Private Limited Company is a popular way to start business in India. Incorporation of Private Limited Company is administered by the Ministry of Corporate Affairs under the Companies Act, 2013 and the Companies (Incorporation) Rules, 2014.

In this article, we will discuss in detail how to incorporate a company and the procedure for company Incorporation.

What is Private Limited Company?

As the name suggests, Private Limited Company is a type of company which does not publicly trade its shares and the liability of each member is limited up to the extent of amount invested in the company.

Definition of Private Limited Company – Section 2(68) of the Companies Act, 2013

“A Company having a minimum paid-up share capital as may be prescribed, and which by its articles,—

    • Restricts the right to transfer its shares;
    • Except in case of One Person Company, limits the number of its members to two hundred;
    • Prohibits any invitation to the public to subscribe for any securities of the company.”

What is the Eligibility of Private Limited Company?

  • Minimum 2 Directors and Maximum up to 15 Directors are required.
  • At least one Director shall be an Indian Resident.
  • It shall have minimum 2 Members or Shareholders and maximum up to 200.
  • Minimum Authorized Share Capital of Rs. 1 Lakh.
  • Each Director shall have Directors Identification Number (DIN)


What are the Benefits of Private Limited Company?

1. Limited Liability

Liability of shareholders is limited to the extent of amount of shares held by them.

2. No Public Trading

Unlike Public Company, incorporation of private company cannot trade its shares to the public.

3. Name of the Company

It is mandatory for Private Limited Company to use the word “Private Limited Company” at the end of the name.

4. Membership

    • Minimum Number of Shareholders – 2
    • Maximum Number of Shareholders – 200

5. Directors

    • Minimum Number of Directors – 2
    • Maximum Number of Directors – 15
  • All the Directors must have Directors Identification Number (DIN)
  • One of the directors shall be a Resident of India

6. Separate Legal Entity and Perpetual Succession

Private Limited Company is a separate legal entity and thus it shall continue to exist even if it’s all members die unless it is legally dissolved.


What is Form SPICe +?

Before discussing the procedure for incorporation of private limited company, it is important to know that the whole process has become simplified with the advent of SPICe+ Form. SPICe+ stands for Simplified Proforma for Incorporating a Company Electronically Plus.

SPICe Plus form is an integrated web form which offers 10 services with following 3 Central Government Ministries-

    • Ministry of Corporate Affairs
    • Ministry of Labour
    • Department of Revenue in the Finance Ministry

Thus, we can say that the Incorporation procedure has become time-effective and cost-efficient.

The SPICe+ form is further classified into two Parts –

Part A – For Reservation of Name

Part B – For other 9 Services that are –

    • Company Registration
    • Director Identification Number (DIN)
    • Permanent Account Number (PAN)
    • Tax Deduction and Collection Number (TAN)
    • Employees Provident Fund Organization (EPFO) Registration
    • Employees State Insurance Corporation (ESIC) Registration
    • Opening a Bank Account
    • Goods and Services Registration (If applicable)
    • Profession Tax Registration (If applicable)


What is the Process of Incorporation of Private Limited Company?

We will discuss in detail procedure for company incorporation and how to incorporate a company

1. Choose the Name of the proposed Company

The first step for incorporating a Private Limited Company is to select the name of the proposed Company. Choosing a name is a brainstorming thus while choosing the name, it must be noted that the name consists of 3 parts that are

    • Main name of the company,
    • Activities to be carried out and
    • The word ‘Private Limited Company’ at the end of name.


2. Obtain Digital Signature Certificate (DSC) – Section 24 of the Information Technology Act, 2000

The next step is to apply for Digital Signature Certificate (DSC) for proposed directors and members. It is used to sign the documents in e-form as it ensures the authenticity and security of the E-Documents.


Apply for DSC


3. Apply for Name Reservation – Form SPICe+ (Part A)

Since the name is decided so now apply for the reservation of name by filing Part A of SPICe+ Form with the ROC. Two names are required to be proposed for reservation, if Central Registration Centre (CRC) accepts the name then proceed with further steps and in case the CRC rejects the name then again 2 new names required to be filed within 15 days from the date of rejection.


Apply for Name Reservation


4. File the Form SPICe+

After the name gets reserved, fill Part B of Form SPICe+ online with the ROC within 20 days from the date of name approval.

This form shall contain all the required details such as Total number of members and directors, Authorized Share Capital, Details of Company. The form is further attached with the following documents-

    • SPICe_Memorandum of Association (E-MOA)
    • SPICe_Article of Association (E-AOA)
    • AGILE for GSTIN
    • INC-9 – Declaration of Subscribers or First Director of Company


Apply for Filing SPICe+ Form


5. Certificate of Incorporation

Thereafter, the Department shall scrutinize the filled form and other related documents and if it is satisfied with the form details and documents then it shall grant the Certificate of Incorporation.


What are the Documents required for Incorporation of Private Limited Company?

  • PAN and Aadhar Card of Directors and Subscribers.
  • Voter ID card or Driving Licence of Directors.
  • Latest Bank Statement of Directors.
  • Passport Size Photographs of Directors.
  • Registered Office Address Proof.
  • Copy of Utility Bills (Not be older than 2 months).
  • Directors Consent in Form DIR-2.
  • Signature Specimen of Authorized Signatory.



Private Limited Company is the most popular form of body corporate among new entrepreneurs and small business entities as it requires less compliances for incorporation and operating a business. Moreover, it has limited liability for shareholders. Registration is a mandatory condition to start a business for Private Limited Company and to get other advantages of Incorporation.

In case of any Query for Private Limited Company Incorporation then contact Manthan Experts for immediate relief.

Apply for Private Limited Company Incorporation

Knowledge Source:

LLP Registration Process in India

Leave a Reply

Your email address will not be published. Required fields are marked *