Overview of Public Limited Company Registration

Public limited companies enjoy all the rights of a corporate entity with limited liabilities and it is an ideal choice for the small and medium scale enterprises who wish to raise the equity capital from the general public.

Basic Clarification on Incorporation of Public Limited Company

Just like other companies, Public Limited Company is also registered as per the rules and regulations of the Companies Act, 2013. A public Company enjoys the benefits of limited liabilities for its members and has rights to sell its shares for raising the capital of the company. It can be incorporated with a minimum number of three directors and has more stringent rules and regulations as compared to a Pvt. Ltd. Company.

It must have a minimum number of seven members whereas there is no limit for the maximum number of members. It provides all the benefits of a private limited company along with more transparency and easy transferability of ownership and shareholding. Name, shares, formation, number of members, management and directors, etc differentiates any Public limited company from the private limited companies.

Benefits of Public Limited Company Registration

Here are the benefits provided to the company with Public Limited company registration

• Limited liabilities for the shareholders of the company

  Shareholders of the public company enjoy the benefits of limited liabilities under which their assets are safe and cannot be used to clear the debts and losses of the company. Despite of it, the shareholders are responsible for their own legal offenses. All the members, directors and shareholders enjoy this right and their assets cannot be seized by any bank, creditors or government bodies.

• Perpetual Succession

  A public limited company is considered as a corporate body that has perpetual succession. Means in case of death, retirement, insanity, and insolvency of one or more members/ shareholder/ directors, the company still continue its existence.

• Improved capital of the company

  In a public limited company, the general public is invited to buy the shares of the company. Hence, anyone can invest in a public company that improves the capital of the proposed company.

• Borrowing Capacity

  A public company can enjoy unlimited sources for borrowing funds. It can issue equity, debentures and can accept the deposits from the general public by selling its shares. Moreover, most of the financial institutions find public companies more prominent than other unregistered companies.

• Fewer risks

  Since public companies can sell their shares to the public, it lesser the scope of unsystematic risks of the market.

  Better opportunities for growth and expansion of the company:

• Fewer risks lead to better opportunities so that the company can grow and expand by investing in new projects from the funds raised by selling its shares in the market.

Documents Required for Public Limited Company Registration

An applicant has to collect all these documents to file along with the incorporation application:

• Identity Proof such as Aadhar card, PAN card, Driving License, Voter Id of all the designated directors and shareholders. 
• Address Proof of all the proposed directors and shareholder of the company.
• PAN card details of all the directors and shareholders
• Utility bill such as telephone, gas, water or electricity bill of the registered office as a residential proof of the business place. It should not be older than 2 months. 
• An NOC or No Objection Certificate from the landlord of the business place. 
• DSC or Digital Signature Certificate of the designated directors
• Memorandum of Association (MOA) and Article of Association (AOA)

Features of Public Limited Company Registration

Here are some important features of Public Limited Company:

• Number of Directors in the company

  As stated in the provisions of Companies Act, a public company must have a minimum number of 3 directors to incorporate a company whereas there is no restriction on the maximum number of directors.

• Name of the Company

  All the Public limited companies must add “Limited” word at the end of their name. it is denoted as an identity of a public company.

• Prospectus of the Company

  Prospectus of the company is mandatory for the public limited companies. It is issued by the proposed company for its general public. It is a note of comprehensive statements of works and affairs of the company. However private companies have no such compliances as they don’t have rights to invite the public for their shares.

• Paid-up Capital

  As per the requirements of the act, no minimum capital required for the registration.

What is the difference between the Public limited Company and Private Limited Company?

There are various points of differences between both these companies. Here are some chief differences between both:

Public Limited Company Registration Procedure

• Step 1: Apply for the Digital Signature Certificate

  First of all, you have to apply for the Digital Signature Certificate for all the proposed directors in the company. DSC is used to sign the e-forms and is an authentic and safe method to file all the documents on an electronic platform. It is a mandatory document.

  A director can easily obtain DSC from the nearest Certifying Authorities or CAs with self-attested coppices of their identity proof. It takes around 1 -3 working days to obtain a DSC.

• Step 2: Name Verification

  The third step involves name registration of the company. You can check the name availability through the MCA portal by following this step

  Visit the MCA Portal> select the MCA services> Click Check Company Name

  Note: The company name should not be taken or registered and should not be similar to a brand name.

• Step 3: Filing Form SPICe+

  Once the company’s name has been approved you can now file the SPICe+ form to avail the company incorporation certificate. Along with it, you have to file all the required documents such as MOA (Memorandum of Association) and AOA (Article of Association). These two documents contain the details of the mission, objectives, aims, visions, business activities, responsibilities of all the directors and shareholders and definition of the proposed company.

  All the documents and applications are further verified by the higher authorities and it takes around 7 to 9 working days.

• Step 4: Obtaining Certificate of Incorporation

  Once all the applications and document to have been received to the authorities and they have verified it, the company would receive the Certificate of Incorporation which will include CIN and date of incorporation.

Requirements for the Public Company Registration

According to the provisions of Companies Act, 2013 here are the requirements you need to fulfill to incorporate a Public company in India:

• The proposed company must have a minimum number of 7 shareholders
• The proposed company must have a minimum number of 3 directors
•  No minimum capital required
• At least one director should have a Digital Signature Certificate
• Memorandum of Association and Article of Association.
• After approval from Registrar of the Companies, the proposed public company has to apply for the “Certificate of Business Commencement.”

Documents Required for TDS Return Filing

The below-mentioned documents are required for filing the TDS Return:-

• General Documents

• TAN (Tax Collection and Deduction Account Number) and PAN of the taxpayer.
• Date of Incorporation of the Business.
• Tenure for which the TDS is to be filed.
• Last TDS filing details.
• Form 16 and a Salary Certificate received from the Employer by the employee.

• Interest Income

• Passbook/Bank statement for interest on savings account
• Income statement of Interest for fixed deposits
• TDS certificates issued by the banks & other

• Capital Gains

• Particulars of investment in the Capital Gains Accounts Scheme
• Sale & Purchase Deed of the property as well as stamp valuation of the property (for building/land)
• Deed of Re-investment purchase for claiming the exemption from Capital Gains
• Credentials for the cost of an improvement on the property (if any improvement is made)
• Particular expense that has been acquired on transfer
• Stock statement in case of the trading in shares etc. (specifying sale & purchase value of shares)
• In the matter of other capital assets, the cost of purchase, cost of improvement, the value of a sale, if any)
  • • Section 80 Investments: Section 80C investment documents: – The investment made under PPF, NSC, ELSS, ULIPS, and LIC qualifies for deductions under Section 80C
  • • House Property
  • • Co-owner details, if the property is co-owned
    • Address of the said property
    • Property Tax, Rent details
    • The Interest certificate issued by the bank for the housing loan
  • • Tax Savings Investments
  • • PPF passbook
    • Tuition fees receipts
    • Repayment certificate for housing loan
    • Donation receipts (along with PAN of the donee)
    • Fixed deposit receipts
    • Deposit receipts for senior citizen saving scheme.
    • Life and medical insurance payment receipt
  • • Others
  • • Receipts of any income from winning the horse races, lottery, etc
    • Details of accrued interest on NSC during the year
    • Dividend amount warrants/
    • Bank Passbook/Statement or interest income certificate
    • PPF passbook for interest
    • Interest certificates on bonds
    • Rent agreement for building, plant & machinery, etc. given on rent (if any)

What are the Eligibility Criteria for GST Registration?

The below mention person/entities are required to get registered under GST –

• Any business entity whose aggregate turnover in a financial year exceeds Rs 40 lakhs (Rs 20 lakhs for special category states in GST).
• Note-This clause does not apply if the entity is only dealing in supply of goods/services which are exempt under GST,
• Every entity who is registered under an earlier law of taxation (i.e., Excise, VAT, Service Tax, etc.) needs to get register under Goods and Service Tax.
• Any entity or supplier dealing in inter-state supply of goods.
• Casual taxable person
• A tax-payer under the reverse charge mechanism
• Input service distributor and its agent
• E-Commerce operator or aggregator*
• Non-Resident taxable person
• Agents of a supplier
• A Person who supplies through E-commerce aggregator.
• Entities who are providing online information, acquiring database, or retrieval services from a place located outside India to a person in India, other than a registered taxable person.

What are the Modes of GST in India?

For GST administration, a model was designed where the government (Central and State) have powers to impose and collect taxes through their respective legislations. The Modes of GST are given bellow:-

• Central GST

  CGST is the tax imposed on the Intra State supplies of goods and services by the Central Government. When the place of the seller and the buyer is in the same state it is termed as an Intra-state supply of goods or services. Here, a seller has to collect both CGST and SGST in which CGST remains with the Central government while the SGST is collected by the State government.

• State GST

  SGST is the tax levied on the Intra State supplies of goods and services by the State Government.

• Integrated GST

  Integrated GST is governed by the IGST Act, where the seller has to collect IGST from the buyer, and the tax collected will be divided between the Central and State Governments.

• Union Territory GST

  Union Territory GST is applicable when any goods and services are used in the Union territories (UTs) of India and the revenue is collected by the government of union territory.

What are the Constituents of GST?

• Registration Number
• Legal Name and Constitution of business
• Trade Name
• Period of validity
• Types of taxpayer
• Date of Liability
• Signature of the applicant

What is the Structure of 5 Slabs Under GST?

GST regimes were made by considering all the layman and inflation rates in mind. To make it simpler and easier, the GST was structured following the four tiers structure. These four zones are given below, which are as follows-

• Zero Rates

  Zero rate tax means the – nil tax is to be applied on the goods and/or services.

• Lower Rate

  Lower tax rate determines the 5% tax rate which is applied on the CPI (Consumer Price Index) basket & mass consumption.

• Standard Rate

  Standard rate includes 12% & 18% of the tax rates.

• Higher Rates

  Higher rates tax includes 28% of the tax rate under GST Regulation.