Obtain a digital signature certificate
Agency: Authorized private agency (Federal)
The applicant must obtain a Class-II Digital Signature Certificate from a certification agency authorized by the Controller of Certification Agencies. These include private agencies like NIC, E-Mudhra, MTNL Trust line, to which company directors submit the prescribed application form along with notarized proof of identity and address.
For obtaining DSC, along with the documents (i.e., Proof of Identity and Proof of Address), a verification video must be submitted by the applicant, stating the name, company name, mobile number, email and intention for applying for DSC. Upon submitting the online application, a hard copy of the form has to be submitted along with supporting documents to the authorized private agency.
A Class-II Digital Signature Certificate can be obtained for either a period of 1 year or a period of 2 years, and then needs to be renewed for another 1 or 2 years upon payment of renewal fees. Each agency has its own fee structure, starting from INR 700. The cost will vary in accordance with the duration of the Digital Signature Certificate. Once the Digital Signature Certificate is obtained, the authorized personnel (directors/manager/secretary) are required to register the same with MCA for statutory e-filing.
Time and cost: 2 day, INR 700 to INR 2,500 per Digital Signature Certificate
Reserve the company name online through “Reserve Unique Name” system (RUN)
Agency: Registrar of Companies, Ministry of Corporate Affairs (Federal)
The company first looks up the availability of a name on the MCA website (http://www.mca.gov.in/mcafoportal/showCheckCompanyName.do), and then goes on to create a new user account under the RUN link in the MCA website.
Online service for reservation of name (RUN or “Reserve Unique Name”) was introduced through the web service available on mca.gov.in. This service has replaced the Form INC-1 for name approval. The following are the fields to be entered in Web-based Application :
- Entity Type: It is required to select the applicable option, i.e. New Company (Others) / Part I Company, Producer Company, Unlimited Company, Private (OPC), IFSC Company, Section 8 Company, Nidhi Company.
- Corporate Identification Number (CIN): Only in case an Existing Company is applying for the Change in Name, it is required to enter its CIN.
- Proposed Name: A Proposed Name option required to be entered here (the form allows to provide 2 names in the form). After entering a Name, MCA has provided Auto Check Facility to check the availability of the Name, accordingly the Applicant and enter the new Optional name, in case the Entity already registered with such proposed name and again has to make Auto Check. When the MCA System provides a Green Remark, Applicant can submit the Applicant with such name option for further Approval.
- Comments: In this field, Applicant can provide the details related to the Proposed Company and activities including the Prior Approvals and TradeMark Registration Details, Resolution (for Existing Company / Foreign Subsidiary Registration).
All applicable documents must be scanned in a single file to be attached to the Web-based Application. After providing the details in the fields and requisite attachments, Applicant can submit the Form Online with the prescribed fees. Name will be reserved only for 20 Days within which the Applicant and/or Promoters are required to file form with MCA-Concerned ROC with requisite documents as per the Incorporation Rules 2014 as per the Companies Act 2013.
As of April 2016 companies can also complete the name reservation through the SPICe form. However, in practice, companies reserve the company name before completing the application for incorporation, as that way company name is confirmed and there is no ambiguity and no chance of SPICe form being rejected due to name rejection.
Time and cost: 1 – 3 days, INR 1,000
Prepare and notarize affidavit by each founder and proposed director
Agency: Notary
Each founder and proposed director has to submit an affidavit confirming that he/she is not convicted of any offence in connection with the promotion, formation or management of any company, or has not been found guilty of any fraud or misfeasance or of any breach of duty to any company during the preceding five years and that all the documents filed with the Registrar for registration of the company contain information that is correct and complete and true to the best of his knowledge and belief. A separate notarized affidavit is required for each person.
As per the Companies Act Amendment 2017 (July 27, 2017), Section 7, the requirement for affidavit to be submitted as part of incorporation documents has been replaced with a requirement of declaration by the directors. However, in practice, companies continue submitting notarized affidavits.
Time and cost: 1 day (simultaneous), INR 10 (stamp paper) + INR 35 (notarizing) for each affidavit
Pay stamp duties, file the SPICE form and obtain the certificate of incorporation, DIN, PAN and TAN
Agency: Registrar of Companies, Ministry of Corporate Affairs (Federal)
Pursuant to Section 7 (1) of the Companies Act, 2013 and pursuant to Rule 10, 12, 14 and 15 of Companies (Incorporation) Rules, 2014, the following forms are required to be electronically filed on the website of the Ministry of Corporate Affairs for incorporation purposes.
It is mandatory for private limited companies to complete the incorporation process using the SPICe Form (Form INC -32). Applications for director identification number (DIN), Permanent Account Number (PAN) and a Tax deduction and Collection Account Number (TAN) have been integrated completely into the SPICe form. The particulars of maximum three directors can be mentioned in SPICe form and DIN may be allotted to maximum three proposed directors through this. If new directors are proposed for an existing company, then a separate DIN application can be submitted.
SPICe eMoA (INC-33) and SPICe eAoA (INC-34) have to be uploaded as ‘Linked Forms’ to SPICe (INC-32). The documents submitted for SPICe need to be digitally signed by all directors. A digital signature of a witness is also required for eMoA and eAoA.
A consolidated challan gets generated at the time of filing SPICe(INC-32) which shall contain applicable fee towards:
- Form Fee
- MoA
- AoA
- PAN
- TAN
Two re-submissions are permitted for the SPICe form. On approval of SPICe forms, the Certificate of Incorporation (CoI) is issued with PAN and TAN as allotted by the Income Tax Department. An electronic mail with Certificate of Incorporation(CoI) as an attachment along with PAN and TAN is also sent to the user. Finance Act, 2018 amended section 139A of the Income-tax Act, 1961 and removed the requirement of issuing PAN in the form of a laminated card.
Companies with authorized share capital below INR 1,500,000 are not required to pay filing fees for eMoA and eAoA.
Time and cost: 4 days, fee schedule for a company with paid-up share capital below INR 1,500,000:
- Electronic filing of the Memorandum of Association (eMOA): none
- Electronic filing fee for filing the Articles of association (eAOA): none
- Electronic filing fee for Form INC-32 SPICe: none
- Stamp duty: INR 100
- Stamp duty for Articles of Association: INR 3,000 (INR 500 for every 500,000 or part thereof)
- Stamp duty for Memorandum of Association: INR 200
- PAN application: INR 110 (including 18% GST)
- TAN application: INR 65 (including 18% GST)
Make a company stamp
Agency: Authorized vendor (Private)
As per the amendment to the Companies Act 2013, making a company seal is no longer a legal requirement. However, making a company rubber stamp is still commonly used in practice. The stamp is normally required to be affixed by a director upon signing on behalf of the company in order to file several applications relevant to business startup. This includes but is not limited to opening a bank account, application for registration with the Employee State Insurance Corporation (ESIC) and application for a company Permanent Account Numbers (PAN).
Time and cost: 1 day (simultaneous), INR 350-500
Open a bank account
Agency: Bank
The bank account details must be provided by the company in various post-registration applications, such as registrations with GST.
After incorporation, company can immediately apply for bank account opening using electronically provided CoI. Banks have introduced new KYC requirements, and request for multiple ID proofs as well as address proofs, which results in a longer than usual processing time for providing with bank account number.
The common documents required for account opening include:
- Certificate of Incorporation (CoI)
- MoA & AoA
- Communication address proof of company
- Registered address proof of company (if different from communication address)
- Board Resolution
- ID Proof of authorized signatory
- PAN card of company (now provided in CoI)
Time and cost: 3 days, no charge
Register with Office of Inspector, Mumbai Shops and Establishment Act
Agency: Municipal Corporation of Greater Mumbai
According to Section 7 of the Bombay Shops and Establishments Act, 1948, the establishment must be registered as follows:
- Under Section 7(4), the employer must register the establishment in the prescribed manner within 30 days of the date on which the establishment commences its work.
- Under Section 7(1), the establishment must submit to the local shop inspector Form A and the prescribed fees for registering the establishment. Supporting documents must be attached, including a certified true copy of the company’s PAN Card, TAN Allotment Letter, Certificate of Incorporation, Memorandum and Articles of Association, a list of company directors, their particulars and copies of their PAN Cards.
- Under Section 7(2), after the statement in Form A and the prescribed fees are received and the correctness of the statement is satisfactorily audited, the certificate for the registration of the establishment is issued in Form D, according to the provisions of Rule 6 of the Maharashtra Shops and Establishments Rules of 1961.
Since the amendments in the Maharashtra Shops & Establishment (Amendment) Rules, 2010, the Schedule for fees for registration & renewal of registration (as per Rule 5) is as follows:
- 0 employees: INR 120
- 1 to 5 employees: INR 360
- 6 to 10 employees: INR 720
- 11 to 20 employees: INR 1,200
- 21 to 50 employees: INR 2,400
- 51 to 100 employees: INR 4,200
- 101 or more: INR 5,400.
In addition, an annual fee (three times the registration and renewal fees) is charged as trade refuse charges (TRC), under the Mumbai Municipal Corporation Act, 1888.
Time and cost: 7 days (simultaneous), INR 1,200 (registration fee) + 3 times registration fee for Trade Refuse Charges (INR 3,600)
Obtain Goods and Service Tax (GST) Registration Number
Agency: Department of Goods and Services Tax, Government of Maharashtra
GST Registration of a business with the tax authorities implies obtaining a unique, 15-digit Goods and Service Tax Identification Number (GSTIN) from the GST authorities so that all the operations of and the data relating to the business can be collected and correlated. Registration under the GST Act is mandatory if your aggregate annual PAN-based turnover exceeds INR 20,00,000 (Rupees Twenty Lakhs). However, in practice, for any operating business, a GST registration is done immediately after incorporation.
To apply for a new registration, the following documents are required:
- PAN card/details of business;
- Valid and accessible e-mail ID and Mobile Number;
- Documentary proof of constitution of business;
- Documentary proof of promoters/partners – Documentary proof of principal place of business;
- Details of Authorised Signatories including photographs and proof of appointment – Details of Primary Authorised Signatory;
- Business bank account details;
- Valid Class II or Class III DSC of authorised signatory in case of companies and LLPs; valid Class II or Class III DSC or Aadhaar (for E-Sign option).
A maximum of 10 Promoters/Partners/Directors can be added in the form. Passport photographs need to be uploaded of all the Promoters/Partners/Directors whose details you are adding in the application form. Further, each passport photograph must be in JPEG format and not more than 100 KB.
The first step to the registration process is the application and verification of PAN number, and the subsequent issue of a Temporary Registration Number (TRN).
The applicant then needs to submit an application in Part B of FORM GST REG-01, duly signed, along with documents specified.
The application is forwarded to the proper officer who examines it and the accompanying documents and if found to be in order, approve the grant of registration to the applicant within three working days from the date of submission of application.
The certificate of registration in FORM GST REG-06 showing the principal place of business and additional place(s) of business is then made available to the applicant on the Common Portal and a GSTIN is assigned in the following format:
- Two characters for the State code;
- Ten characters for the PAN or the Tax Deduction and Collection Account Number;
- Two characters for the entity code; and
- One checksum character.
Time and cost: 4 days, no charge
Register with the Employees’ Provident Fund Organization (EPFO) and the Employees’ State Insurance Corporation (ESIC)
Agency: Shram Suvidha Portal of Ministry of Labour and Employment
The Employees Provident Fund Organization (EPFO) is a statutory organization under the Ministry of Labor and Employment. The Employees Provident Funds & Miscellaneous Provisions Act, 1952 applies to an establishment, employing 20 or more persons and engaged in any of the 183 Industries and Classes of business establishments, throughout India excluding the State of Jammu and Kashmir. Furthermore, new companies are required to register with the Employees’ State Insurance Corporation (ESIC).
On April 30, 2017, an online registration was introduced the Shram Suvidha Portal combining the EPFO and ESIC registrations into one. However, it was not a preferred method for the majority since paper copies had still to be filed after the online registration. In April 1, 2018, the electronic registration process was further enhanced and it became the only option to register for ESIC and EPFO. EPFO & ESIC registration is now done on the same Shram Suvidha portal (https://registration.shramsuvidha.gov.in) and in one application. However, the website was reported to be quite slow and with numerous glitches during the registration process – fields not accepting information, the screen timing out, etc. As a result, although registration is done electronically, it can take a long time in practice.
Time and cost: 1 day (simultaneous), no charge
Register for Profession Tax
Agency: Sales Tax Department, Government of Maharashtra
Professional Tax in Maharashtra is levied under Maharashtra State Tax on Professions, Trades, Callings and Employments Act, 1975. It is levied on Company, Firm, Proprietary Concern, Hindu Undivided Family (HUF), Society, Club, Association of Persons, Corporation or any other corporate body in Maharashtra.
Professional Tax in Maharashtra for Organisations: An employer organization is required to get registered under the Profession Tax Act and obtain a Registration Certificate under which the payment in respect of taxes deducted from employees’ salaries can be made. Also as a firm, the organization is required to obtain Enrollment Certificate and pay Profession tax on its behalf.
Delays in obtaining Enrollment or Registration Certificate are penalized at the rate of Rs. 2/- (Rupees Two) per Day. In case a false information regarding enrollment is provided, then the Penalty is 3 times of tax amount. The interest for non-payment / delayed payment of profession tax is 1.25% per month and the Maharashtra state authority can also impose a penalty of 10% of the amount of tax not paid/short paid/delayed.
There are 2 types of Profession Tax payers:
- Profession Tax Enrollment Certificate (PTEC) : Any person engaged in Profession, Trade and Callings and falling under one or the other of the classes mentioned in the second column of Schedule I shall obtained PTEC;
- Profession Tax Registration Certificate (PTRC) : Every employer who has employed even a single employee whose salary is above the prescribed limit for deducting Profession Tax shall obtain PTRC.
All new companies must be first obtain a Profession Tax Registration Certificate. And then proceed to enroll all employees for a Profession Tax Enrollment Certificate for any of the employees who have never been employed (for employees who have been previously enrolled, there is no need to re-enroll).
Time and cost: Less than 1 day (online procedure), no charge
