Public Limited Company Incorporation is a tedious process which requires skills and patience. Public Limited Company can offer shares to the general public by way of Initial Public Offering whereby any person can buy or sell the shares of company in seconds.
What is Public Limited Company?
Public Limited Company is a Company having Limited Liability of its shareholders and it offers its shares to the general public through Initial Public Offerings (IPO) or through trading on Stock Exchange.
Thus, any person can buy or sell the shares of the Public limited Company and Public Limited Company has to use the word “Limited” after its name.
What is the Eligibility of Public Limited Company Incorporation?
- Minimum – 7
- Maximum – No Limit Prescribed
- Minimum – 3
- Maximum – No Limit Prescribed
- Authorized Share Capital
- Minimum – 5 Lakh
- Company Name
It is mandatory for every Public Limited Company to place the word ‘Limited’ at the end of the Company name.
Unlike Private Limited Company, Public Limited Company must issue the prospectus for general public at the time of Incorporation. It manifests the statement of work and affairs of the company.
- Digital Signature certificate (DSC)
Designated directors of the Public Limited Company must possess the DSC.
- Index of Members
Public Limited Company is mandatorily required to keep an Index of its members along with requisite details.
- Governing Laws
A Public Limited Company is governed by following Laws –
What are the benefits of Public Limited Company?
- Ensures Credibility
Since every important document and affairs of the Public Limited Company are disclosed in Public Domain therefore it makes the Company more reliable and trustworthy. Thus, enhances the Credibility.
- Sufficient Capital
Public limited Company can raise funds by issuing shares to the general public. Thus, Initial Public Offering is the major source to meet capital requirement.
- Easy Trading of Shares
The shares of Public Limited Company can easily be traded at stock exchange within seconds. It makes the process of acquiring part of company easy for investors and shareholders.
- Limited Liability
Like Private Limited Company, the liability of shareholders of public limited company is limited to the extent of amount shares invested in the company. Thus, they shall not be personally liable for the debts and liability of the company.
- Risk Sharing
A Public Limited Company is owned by a number of shareholders in small proportion. Thus, the risk of insolvency of the company is shared by them in that small portion only.
What are the Documents required for Public Limited Company Incorporation?
- Identity Proof of all the shareholders and Designated Directors [Aadhar Card, PAN Card, Driving License and Voter ID Card]
- Address Proof of all the shareholders and proposed directors
- Utility Bills (older than 2 months)
- Digital signature Certificates of all the Designated Directors
- Memorandum of Association
- Articles of Association
Apply for Documents Preparation
What is the procedure of Public Limited Company Incorporation?
- Choose the name of the Proposed Company
The first step to incorporate a public limited company is to choose the name of the proposed company. While deciding the name of the company, it must be noted that the name should describe the core affairs of the company and it must include the word ‘Limited’ at the end of the name.Apply for the Name Assistance
- Obtain Digital Signature Certificate (DSC)
The next step to incorporate a Public Limited Company is to apply for Digital Signature Certificate for all the authorized signatories of the company for e-filing of documents.
Digital Signature Certificate is mandatorily required for e-filing of documents with MCA while incorporating Public Limited Company.Apply for DSC
- File the Application Form for Name Reservation – Form SPICe + (Part A)
Thereafter, the proposed company shall apply for the Name Reservation by e-filing the Part A of the Form SPICe+. A Company can propose two names if only Part A is submitted for Name Approval. If Part B is also filed for Company Incorporation then only one name can be submitted.
Before SPICe + Form, Reserve Unique Name (RUN) Web Service was used for name reservation but now Companies can utilize RUN Service for Changing the Company’s name.
- Filing of Part B of the Form SPICe +
Lastly, the applicant has to file the Part B of the Form SPICe +. Part B is filed for availing following services –
- Public Limited Company Incorporation
- Director’s Identification Allotment
- Permanent Account Number (PAN)
- Tax Deducted/Collected at Source (TAN)
- AGILE Pro Form is to be filed along with Form SPICe + to avail following –
- Employees Provident Fund Organization (EPFO) Registration
- Employees State Insurance Corporation (ESIC) Registration
- Good and Services Tax Registration , if applicable
- Professional Tax, if applicable
- Opening a Bank Account in the Company’s Name
Other Mandatory Attachments with Form SPICe + are as follows
- Details of Subscribers and Directors
- Registered Official Address of the Proposed Company
- Details of the Capital Structure of the Proposed Company
- Details required for PAN & TAN
- Declaration of subscribers and First Director of the Company – INC 9
- Copy of Utility Bills (Not older than 2 months)
- Consent of Nominee in Form INC-3
- ID Proof and Address Proof of the Applicant
- Certificate of Incorporation
Lastly, the ROC shall verify all the documents and forms and if the Registrar is satisfied then it shall issue the Certificate of Incorporation. Thus, Public Limited Company can start its business operations.Apply for Public Limited Company Incorporation
When the Public Limited Company is incorporated then the company is required to observe many tax and regulatory compliances. So Public Limited Companies require Professionals’ help to complete all legal compliances in order to avoid penalties and other legal consequences.
Contact the Manthan Experts Team for seeking assistance from incorporating a company to managing its affairs in accordance with the laws.Apply for assistance