How to start a startup legally?

By Sunday, April 10, 2016

                  How  to start a startup legally?

Algorithm for starting a Private Limited Company: Engineer's View
Personally I believe, If someone is starting a company with long term perspective or to bring some change through their unique Product/Services, one must go for Private limited firm. Prime reason for this is easy to raise funds from Angels/VC in case you go for investment.
Step 1. Registration of Company
  1. Name Selection: Check whether your desired company name is available or not atMCA website. Name must be unique & must resemble with business you intend to do (highlighted one). EX: Arihant Labs Retail Services Pvt. Ltd
  2. Registration of Name at ROC: Name approval usually takes maximum of 14 days. This is done online through MCA website. Moreover, you need to apply with at least 4 names for approval with a writeup about significance of names with main business of the company.
    1. Documents Required:
      1. Options for names for the proposed Company (on the basis of preference)
      2. Amount of Share Capital; proposed shareholding ratio
      3. A paragraph on the proposed major line of business of the company (main objects)
      4. City of Registered Office.
      5. Copy of ownership deed/sale deed(if property is owned)
      6. Copy of rent agreement with NOC (if property is rented)
      7. Copy of latest electricity bill/telephone bill/mobile bill for both directors
      8. Copy of latest electric bill/telephone bill for the registered office proof.
  3. Obtaining DIN & DSC:
    1. Documents Required
      1. PAN Card copies for directors and shareholders.
      2. Voter ID/Passport/Driving License for directors and shareholders.
      3. Occupation of the Directors for directors and shareholders.
      4. E-Mail IDs of all directors and shareholders.
      5. Phone Numbers for all directors and shareholders.
      6. Photos for directors and shareholders
  4. Company Incorporation: After above mentioned formalities have been completed, we need to file following forms/docs in Rs 100 stamp paper:
    1. Affidavits for non- acceptance
    2. INC 9, INC 10
    3. DIR 2
    4. NOC : This is required to be filed by the owner of the property on which your company will be situated.
    5. Subscriber Sheets of MOA & AOA
    6. Documents required for filling MOA & AOA
      1. Must be filled on OWN handwriting
      2. Passport size photos
      3. Sheets needs to be witnessed by CA/CS/Advocate
Step 2. Obtaining PAN/TAN: After company gets incorporated, you may apply for PAN/TAN.
Step 3. Trade Licence in case you are selling PRODUCTS: This is required in some places for carrying out sales. You can obtain this from local Municipality.
Step 4. VAT/CST registration for selling Products: For selling intra-state, you need VAT registration & for selling inter-state, you need to register for CST.
  1. Documents Required:
    1. Trade Licence
    2. Company Incorporation Certificate
    3. PAN card of company as well as of all the directors
    4. Proof of residence of Directors
    5. Proof of occupancy of place of business (Rent agreement/ ownership deed, Rent Bills etc)
    6. MOA & AOA of company
    7. Current Account in the name of company in any national bank
Step 5. Service tax registration for Service Industry: In India, you need to pay service tax of 14.5% on every services you have charged customer for.
  1. Documents Required:
    1. Company Incorporation Certificate
    2. PAN card of company as well as of all the directors
    3. Proof of residence of Directors
    4. Proof of occupancy of place of business (Rent agreement/ ownership deed, Rent Bills etc)
    5. MOA & AOA of company
    6. Current Account in the name of company in any national bank

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