How to register your startup in India?

To begin with, here is a witty quote on existence by Friedrich Nietzsche, “Art is essentially the affirmation, the blessing, and the deification of existence.” The art of entrepreneurship lights up the minds of all and sundry. To give your own venture or a startup a legal existence, the first and foremost initiative to be considered is ‘Registration.’ Be it a sole proprietorship or a joint venture, registration is must to make huge strides towards your career goal of becoming an owner of a startup. However, the complete process of registration is a bit tedious with mind numbing propositions.

Diving further into the details, it becomes imperative to list the rules to be adhered to register your Private Limited company:

• Any new Private Limited company should have a minimum of two directors. In addition, a minimum of two shareholders is another pre-requisite.
• Transfer of shares of directors and shareholders is never left to their own volition. They have to abide by the law.
• Interestingly, there is an upper limit on the maximum number of shareholders. Well, the maximum number of shareholders should never exceed fifty under any circumstances.
• General public are obviated from purchasing the shares or debentures of any newly established private limited company.
• Talking about the deposits, deposits from the relatives of shareholders are encouraged. However, deposits from the unknown and general public are dismissed.

Here is a simple 4 step procedure to register your startup in India:

1. Apply for DIN (Direct Identification Number):

As the name clearly explains, DIN is a unique identification number that is given to the existing director of a company which is incorporated. After the insertion of the sections 266A and 266B into the Companies Act, 1956, DIN has become an absolute must have. The chief motive behind DIN is to store and maintain the details of directors and to prevent the vested interests of double-dealers. This takes around 1-2 days.

Fill in the application provided in the following link:

http://www.mca.gov.in/MCA21/

What it takes to complete the formalities is just a one-hundred rupee note.

2. Apply for Digital Signature Certificate:

Digital Signature Certificate is important to ensure the security and genuineness of the documents submitted electronically. It takes around Rs400-2650 to complete the formalities. A list of documents, bank accounts, photographs of directors etc. are to be submitted to the authorities concerned. This takes around 4-7 days. For further details, please visit the link: http://www.mca.gov.in/MCA21/certifying-new.html

3. Approval of Company name:

This is a tedious task. You have to file 4 forms – FORM 1A, FORM 1, FORM 18, and FORM 32.FORM 1A allows you to apply for a company name.  You shall receive an acknowledgement from Registrar of Company expressing his/her approval. This takes around 2-3 days. FORM 1, FORM 18 and FORM 32 are required to get certificate of Incorporation. For certificate of incorporation, you have to wait for 7 days. For further details, you may visit: http://www.mca.gov.in/MCA21/RegisterNewComp.html

4. Apply for TAN (Tax Account Number):

TAN signifies Tax deduction Account Number. To apply for TAN, one has to fill the form 49B. Here is the link to the form: https://tin.tin.nsdl.com/tan/form49B.html One has to pay a sum of Rs 62/- (well, this figure may vary). It takes around 7 days to get TAN.

While the complete process of a company registration may take around 30-45 days, unlike Public Limited companies, Private Limited companies may start their operations immediately after receiving the Certificate of Registration.