Company Incorporation -The Procedure for Incorporating A Company in India

Today, the procedure of incorporate a company in India has become easy and effective, which make your business successful and efficient. Company incorporation in India and setting up of branch offices of foreign corporations in India are regulated by the Companies Act, 1956. The Companies Act of 1956 sets down regulations and rules for the establishment of both private and public companies in India. For the purpose of company formation in India under the companies act, 1956, the first and essential step for the formation of a company is the approval of the name by the Registrar of Companies in the State/Union Territory in which the company will maintain its registered office. The approval of company incorporation is subject to certain conditions. Further, the last words in the name are needed to be "Private Ltd." in the case of a private company and "Limited" in the case of a Public Company.

The articles of association and memorandum of association are the most important Document to be submitted to the ROC for the purpose of company incorporation. The Memorandum of Association is a document, which sets out the constitution of the company. The objects and the scope of activity of the company and also defines the relationship of the company with the outside world. The Articles of Association contain the regulations and rules of the company for the management of its internal affairs. While the Memorandum specifies the purposes and objects for which the Company has been formed, the Articles lay down the regulations and rules for achieving those objects and purposes. The ROC will give the certificate of company incorporation after the required documents are presented alongwith the requisite registration fee, which is scaled according to the share capital of the company, as stated in its Memorandum. A private company can begin business on receipt of its certificate of incorporation.

A company is formed by registering the Memorandum and Articles of Association with the Registrar of Companies. A public or private company has the option of inviting the public for subscription to its share capital. Accordingly, the company has to issue a prospectus, which provides information about the company to potential investors. The Companies Act specifies the information, which is to be contained in the prospectus. The prospectus has to be filed with the ROC before it can be issued to the public. In case the company decides not to approach the public for the essential capital and obtains it privately, it can file a "Statement in Lieu of Prospectus" with the ROC. On the fulfillment of these requirements, the ROC issues a Certificate of Commencement of Business to the public company. The company can begin business immediately after receiving this certificate. 

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