Private Limited Company Registration in Delhi

A Private Limited Company is an entity that is held by private stakeholders. This structure protects owners by limiting their liability and ensuring controlled transfer of ownership. As per Section 2 (68) of the Companies Act 2013, a private limited company means:

• It cannot invite the public to buy its shares or securities.
• Its shares cannot be freely sold or transferred to others.
• It can have a maximum of 200 members (except in the case of a One Person Company).
• Earlier, a minimum paid-up share capital of Rs. 1 lakh was required; however, there is no minimum limit now.

Private limited companies enjoy immense popularity among Small and Medium-sized Enterprises (SMEs) and startups seeking legal recognition. This business structure allows owners to own properties, enter into contracts, and conduct business in their name.

India’s capital, Delhi, is a prominent hub for large enterprises, SMEs, and startups. Its strong customer base, diverse industries, and active investor community also increase the need for a business structure that offers both growth opportunities and credibility.

In Delhi, entrepreneurs choose a private limited company due to various reasons, such as:

• Supportive Startup Ecosystem: Delhi NCR is a hub for business events, innovation, and co-working spaces. Thus, a private limited company can leverage this supportive ecosystem to enhance scalability.

• Strong Investor Confidence: Delhi is home to various financial institutions, angel networks, and venture capital firms that prefer investing in private limited companies due to their transparency.

• Proximity to Regulatory and Government Bodies: Delhi boasts easy access to ministries, regulatory authorities, and government offices. This simplifies business operations and access to policy benefits.

Registering a private limited company offers several advantages that help business owners expand confidently and operate smoothly. Some key benefits of a private limited company include:

• Ease of Operation: This model allows businesses to raise funds, attract investors, and issue new shares. This makes it easier to grow in Delhi’s competitive market.
• Separate Legal Identity: Under this business structure, entrepreneurs can sign contracts, own assets, and independently continue operations.
• Enhanced Brand Recognition: Operating as a registered private limited company builds stronger trust among Delhi’s customers and corporate clients.
• Tax Planning Benefits: Private limited companies benefit from structured tax planning options and exemptions, which can reduce the overall tax burden.
• Better Access to Skilled Talent: Professionals prefer working with registered companies as they reflect career growth prospects and stability.

Certain documents and compliance steps must be followed to register a private limited company in Delhi. Some key requirements that ensure the business can operate within the city’s regulatory framework include:

• Directors and Shareholders: A minimum of 2 shareholders and 2 directors are required. The same individuals can act as both.
• Registered Office in Delhi: You must provide a local address (residential or commercial) within Delhi. This serves as the company’s registered office.
• Director Identification Number (DIN): Each director must have a DIN issued by the Ministry of Corporate Affairs (MCA).
• Memorandum of Association (MoA) & Articles of Association (AoA): You must provide the MoA and AoA to define the company’s objectives and internal rules.
• Digital Signature Certificate (DSC): A Digital Signature Certificate (DSC) is required for signing electronic documents during the registration process.
• PAN and TAN Application: Once the company is incorporated, a PAN and TAN application is mandatory for tax purposes.

To register a private limited company in Delhi, entrepreneurs must ensure that they meet the specific eligibility conditions. The eligibility criteria include:

• At least one director must be an Indian resident. They must have lived in India for a minimum of 182 days in the previous year.
• Directors must be 18 years of age or above.
• The proposed company name should be unique and approved by the MCA.
• The company must declare the authorized capital in its incorporation documents.

The process of registering a private limited company in Delhi is completely online. It is governed by the Registrar of Companies (RoC) Delhi under the MCA. Here’s a step-by-step process to register a private limited company in Delhi:

Step 1: Obtain a DSC and a DIN

• Acquire a Digital Signature Certificate to enable directors and shareholders to sign documents electronically. You can apply for a DSC from government-approved certifying authorities.
• Obtain a DIN by filing the SPICe+ form during the incorporation process. A DIN is mandatory for all directors of the company.

Step 2: Choose and Reserve a Unique Company Name

• Choose a unique company name. It should not resemble any existing registered company or trademark.
• You can apply for name reservation using the SPICe+ Part A form on the MCA portal.
• Shortlist at least 2–3 names in case the first option is rejected.

Step 3: Drafting the Memorandum of Association (MoA) and Articles of Association (AoA)

The MoA defines a company’s objectives and scope of operations. Meanwhile, the AoA outlines the rules and regulations governing the company’s internal management.

• Carefully draft both the MoA and AoA.
• File them with the MCA during the incorporation process.

These documents establish the foundation of the company’s legal structure.

Step 4: Filing the SPICe+ Form for Incorporation

A SPICe+ form is a single integrated form that simplifies the incorporation process. It includes applications for PAN, TAN, EPFO, ESIC, professional tax (if applicable), and bank account opening.

• Provide details of directors and shareholders, the registered office address in Delhi, and share capital.
• Attach supporting documents such as address proof, identity proof, and NOC from the property owner (if rented).

Step 5: Receiving the Certificate of Incorporation

• After the Registrar of Companies (RoC) Delhi verifies and approves the application, your company is incorporated.
• Download the digitally issued Certificate of Incorporation (CoI). The CoI comes with a unique Corporate Identity Number (CIN).
• Receive the company’s PAN and TAN, which serve as legal proof of its existence in Delhi.

Certain documents must be submitted to the RoC to successfully register a private limited company in Delhi. These documents vary depending on whether the applicant is a foreign national, an Indian national, or relates to the company’s registered office address.

Documents for Indian Directors and Shareholders

• Self-attested copy of Aadhaar Card, Voter ID, Driving License, or Passport as identity proof.
• Self-attested copy of PAN Card
• Latest utility bill (electricity, water, gas, or telephone bill) or bank statement (not older than 2 months) as address proof.
• Digital Signature Certificate (DSC) of directors.
• Passport-size photograph of each director and shareholder.

Documents for Foreign Nationals

• Residential address proof such as a bank statement, utility bill, or driving license (not older than 2 months).
• Notarized and apostilled copy of Passport (mandatory).
• Passport-size photograph.
• Digital Signature Certificate (DSC) for foreign directors, which must be obtained in India.
• If original documents are not in English, notarized and translated copies in English.

Documents for the Registered Office in Delhi

• Ownership documents or Rent Agreement along with No Objection Certificate (NOC).
• Copy of the latest electricity bill, water bill, or property tax receipt as proof of office address.

A Simple Checklist of All the Documents You Will Need

• Address proof (utility bill, bank statement, or Aadhaar/Voter ID).
• PAN Card of all Indian directors and shareholders.
• Passport (for foreign nationals).
• Digital Signature Certificate (DSC).
• Passport-sized photographs.

Both professional service fees and government charges are required for registering a private limited company in Delhi. The exact cost of registering a private company in Delhi depends on several factors, like authorized share capital, the number of directors, and additional compliances.

Breakdown of Government Fees and Stamp Duty in Delhi

Note: Stamp duty varies by state and capital. It starts from Rs. 135 to Rs. 15,020 for capital up to Rs. 1 lakh.

Are There Any Hidden Costs to Be Aware Of?

Although most costs are transparent, additional fees may arise from:

• Notarization of documents
• Resubmission in case of errors in documentation
• Higher stamp duty if the authorized share capital is increased.

When starting a business in Delhi, you can choose from different types of company structures depending on your needs. Each type has its own rules for ownership, liability, taxation, and compliance.

Various post-incorporation compliances must be completed once your private limited company is successfully registered to ensure smooth functioning and avoid penalties. Mandated under the Companies Act, 2013, some requirements apply to all companies incorporated in Delhi, including:

Opening a Company Bank Account

Open a current account in the company’s name in a Delhi-based bank. This is important for financial transactions, including share capital deposits and business operations.

First Board Meeting Within 30 Days

Conduct the company’s first board meeting within 30 days of incorporation. Discuss important matters like the appointment of the first auditor, the issuance of share certificates, and the adoption of the common seal.

Appointment of the First Auditor

Appoint the first auditor within 30 days of incorporation as per Section 139 of the Companies Act.

Issuance of Share Certificates

Issue share certificates to all shareholders within 60 days of incorporation. This should be done only after receiving the share capital subscription in the company’s bank account.

Filing for Commencement of Business (Form INC-20A)

File a declaration in Form INC-20A with the Registrar of Companies (Delhi) within 180 days of incorporation. This is essential to commence your operations.

Annual Compliance to Keep in Mind

• File Annual Return (Form MGT-7) with the Registrar of Companies, Delhi.
• File Financial Statements (Form AOC-4).
• Hold board meetings at least four times a year (for larger companies) or twice a year (for smaller ones).
• Maintain Statutory Registers such as Register of Members, Register of Directors, and Register of Charges at the registered office in Delhi.