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Public limited Company Registration in India -An Overview

Public Limited Company registration in India or incorporation is the subject of involving a legal process which should be handled by a professional tax consultant. As per the Indian act, a Public Limited Company holds a distinguished legal identity from its owners. A private limited company is not entitled to raise capital from public or issue shares for public subscription. The Public Limited Company registration is complicated compared to proprietorship and partnership firm. Tax Seva Kendra offers high quality services as a Public Limited Company registration consultant at much affordable price.

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Public limited Company Registration Package

Rs.8,000/-+18% GST

  • What we provide
  • Documents required
  • Certificate of Incorporation (CIN)
  • Permanent Account Number (PAN)
  • Memorandum of Association (eMOA)
  • Articles of Association (eAOA)
  • Director’s Identification Number (DIN No)
  • Digital Signature (DSC)
  • GST Registration
  • Required two names of the Company
  • Companies Object
  • Office Address Proof (Rent Agreement, Receipt, Electrical Bill, Owner Property tax)
  • Director's PAN, Aadhar, Voter Card
  • Director's Electrical Bill
  • Director's Driving Licence or Passport (If any)
  • Director's Last 6 months Bank statement
  • Director's Photo
  • Director's Email and Mobile

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Basic RequirementsTo Register a Public Limited Company in India

In accordance with the provisions of Companies Act, 2013 below are the requirements you need to fulfil for incorporation of Public Limited Company in India:

  • Minimum number of shareholders is 7
  • Minimum 3 directors
  • No minimum capital requirement
  • At least one director must apply for Digital Signature Certificate (DSC)
  • DIN required for all directors
  • Drafting of Memorandum of Association and Article of Association
  • Submission of all the documents to ROC and MCA and after receiving approval from Registrar of the Companies (ROC), the proposed public company has to apply for the Certificate of Business Commencement which will complete the last step of incorporation

Minimum Paid Up Capital for Public Limited Company

Companies Amendment Act 2015 have omitted the minimum paid up capital requirement and revised it that there is no minimum requirement of paid-up capital of the Company. That implies that a Public Limited Company can be formed with even Rs.1, 000 as paid-up capital.

Types of Public Limited Company

i. Listed Companies:

As per Section 2(52) of the Companies Act, 2013 a listed company is a public company that has its securities listed on any recognised stock exchange, for e.g. BSE, NSE etc and can issue a prospectus for subscription of shares by way of an initial public offering. This ensures that there are many shareholders, securing and insuring liquidity. Examples: Wipro, Tata Consultancy Services, etc.

ii. Unlisted Companies:

Such companies are mostly owned by its promoters or private investors. They are not entitled to issue a prospectus to the public, as their securities are not listed on any recognised stock exchange. They usually finance their capital from their members, directors, their friends and relatives. An unlisted public company is different from that of a private company, as there is no limit on the number of shareholders to raise capital. They have less strict regulatory guidelines as they are not liable to comply with any regulations formulated by SEBI, it has to comply with guidelines issued by the central government or ministry of corporate affairs. Examples of such company: Bennett Coleman, Parle etc.

List of Documents Required for Public Limited Company Registration in India

An applicant has to furnish all the following documents for public limited company registration-

  • Identity Proof such as Aadhar card, PAN card, Driving License, Voter Id etc of all the directors and shareholders.
  • Address Proof of all the directors and shareholder of the company.
  • Address Proof: Utility bill such as telephone, gas, water or electricity bill of the registered office. It should not be older than 2 months.
  • No Objection Certificate from the owner of the business place.
  • Digital Signature Certificate of the directors
  • Directors Identification Number (DIN)
  • Memorandum of Association (MoA) & Article of Association (AoA)

Public Limited Company Advantages and Disadvantages

ADVANTAGES OF A PUBLIC LIMITED COMPANY

Public limited company registration is one of the popular company registrations in India due to its special advantages. Let us take a look at the advantages of Public Limited Company.

Raise Capital through Issue of Shares

Insufficiency of capital is inevitable while running a business, but a Public Limited Company has the option to raise capital by the public issue of Shares, unlike a Private Limited Company.

Funds are easily Transferable

The securities can be transferred easily. Since the stocks of a Public Limited Company are listed on stock exchange, it drives more potential shareholders.

Access to additional Funding

Banks and financial institutions generally render credit/ loans to Public Limited Companies at favourable interest rates. Public Ltd Company has the authority to negotiate the terms of conditions for loan repayment.

Limited Liability of the shareholders

The liability of the shareholders and Directors is limited to the extent of the shares they hold in the company. For example, if the company faces any financial contingencies because of primary business activity, then in such cases personal assets of shareholders and Directors will not be seized by the Banks, creditors, and government.

Maintains the Brand Protection

In Private Limited Company any foreigner or NRI can do investment without the Government approval. As a result, foreign investment inflow is creating and way of the growth of the company is making.

DISADVANTAGES OF A PUBLIC LIMITED COMPANY

A Public Limited Company may have the following disadvantages:

Higher Paid-Up Capital:

The cost of incorporating a Public Limited Company is comparatively higher

Attention to Strict Regulations:

A PLC has to comply with several statutory regulations laid by different Governmental body. Although, such legal norms are laid to safeguard the interest of the Company’s shareholders.

Requires Absolute Transparency:

Since Public Limited Companies issue prospectus to the public for share subscription, they are required to disclose all information about their growth potential and business operations. PLC has to maintain transparency in its operations, decision making, even their account details.

What Are the Compliances to be followed by the Public Limited Company in India?

Mentioned below are the mandatory compliances:

  • Minimum 4 board meeting to be held in every financial year.
  • Appointment of the auditor in Form ADT-1.
  • Hold annual general meeting (AGM) every year within 6 months from the end of the financial year. And first AGM is to be held within 9 months from the end of the first financial year.
  • File financial statement in Form AOC-4 within 30 days from date of Annual General Meeting.
  • File annual return in Form MGT-7 within 60 days from date of Annual General Meeting.
  • Statutory audit of accounts certified by Chartered Accountant at the end of the financial year.

Time Frame of Registering a Public Limited Company in India

Approximately it takes up to 20 working days to incorporate a public limited company in India. However, it may vary depending on the clearances acquired from different government authorities.

Difference between Public Limited Company and Private Limited Company

This article will give you a broad idea about the differences between Public Limited Company and Private Limited Company.

Point of Difference Public Company Private Company
Definition/Meaning A Public Company is listed on a recognized stock exchange and its securities are traded publicly. A Private Company is owned and traded privately and is not listed on a stock exchange.
Suffix Limited (LTD) at the end of the name Pvt. Ltd at the end of the name
Min. Members Minimum 7 members Minimum 2 members
Max Members No maximum limit The maximum limit is 200
Min Directors At least 3 directors are required At least 2 directors are required
Commencement of Business Certificate of incorporation and commencement of business is required. Only Certificate of Incorporation is required to start the business.
Public Subscription of Shares Public subscription of share is allowed Public subscription of share is not allowed
Quorum at AGM/ Annual General Meeting 5 members must be present personally at AGM 2 members must be present personally at AGM
Statutory Meeting It is compulsory It is optional
Issue of Prospectus It is mandatory to issue Prospectus Not required in a private company
Shares Transferability Share can be transferred freely Transfer of share is restricted
Managerial Remuneration There is no restriction is managerial remuneration It can exceed 11% of the Net Profit
Disclosure of Financial Report A public company is required to disclose its financial reports quarterly and annually There is no such obligation for a private company to disclose its financial reports to the public
Size Generally, the size of a public company is very large The size of a private company is small compared to a public company
Funding It can raise funds by issuing an IPO in the general public It can raise funds through private investors

Public Limited Company Registration Fees in India

Public Limited Company Registration fees can range from Rs. 12500 and above depending on a number of factors. The costs may vary from state to state. It is just to give an idea about the governmental charges and levies required other than professional charges.

Why Choose TAX SEVA KENDRA- An Online Public Limited Company Registration Agency in India

  • We have professionals who have conducted different forms of registration activities with the priority of adding value to your business.
  • We work with experienced and recognised Chartered Accountants, Company Secretaries, Lawyers, and Financial Executives.
  • We have experience in registering different types of companies
  • Transparent operations
  • Result oriented, time-oriented approach

FAQ On Public Limited Company Registration in India

How many directors and shareholders are needed to incorporate a Public Limited Company in India?

Minimum 3 directors and 7 shareholders required for PLC.

How many days are needed to incorporate a Public Limited Company?

Approximately it takes up to 20 working days to incorporate a public limited company in India.

Is registration compulsory for public limited company?

It is mandatory to register a PLC.

How many shares can a private company issue?

The number of shares per company is finalised at the company's creation and can only be increased or decreased through a vote by the shareholders.

Who manages the business of a public limited company?

The shareholders and directors carry out business activities relating to the business and take part in decision making. The Company Directors holds the authority over the management of the company.

What is the maximum limit of members required to start a Public Ltd Company?

There is no prescribed limit as for the maximum number of members/shareholders for starting a Public Limited Company.

Which companies are not required to add Ltd or Pvt. Ltd at the end of their name?

Section 8 Company is exempted from clause (a) of Section 4(1) implying that Section 8 Company is neither required to add the word “Ltd” nor “Private Ltd” at the end of its name.

What is difference between public and private company?

A public company is a company listed in the well-known stock exchange and can be traded freely and publicly. Whereas a private limited company is not listed on a stock exchange and it is held privately by the members of the company and does not trade its securities on the stock exchange.

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