| What is the minimum number
of shareholders in a private limited
company? |
| Two.
They could be individuals or legal entities. |
|
TOP |
|
| What is the minimum number
of directors in a private limited company? |
| Two. The Directors must compulsorily be individuals.
They cannot be corporate bodies. |
|
TOP |
|
| What is the minimum share capital of a private
limited company? |
| Rupees One lakh (INR 100,000). However the requirement of
minimum share capital may go up if certain words such as India (INR
500,000), Asia (INR 5,000,000), Global, Universal, Industrial (INR
10,000,000) are chosen as part of the companys name. |
|
TOP |
|
| Can all the directors of a private limited company be
foreigners? |
| Yes.
However the Registrar of Companies may insist on Indian individuals
as alternate directors. |
|
TOP |
|
| Are there any prior approvals to be obtained from any
authority in India to become a director in an Indian
company? |
| Yes. Every individual who is contemplating a position of
a director in an Indian company must obtain a Directors
Identification Number (DIN) before he can become a director in an
Indian company. |
|
TOP |
|
| What needs to be done to obtain a
DIN? |
| An
application needs to be submitted to the MCA DIN Cell to obtain a
DIN. Click here for more
details. |
|
TOP |
|
| How frequently should the Board of Directors
meet? |
| The
Board of Directors should meet at least every three
months. |
|
TOP |
|
| Can all the Board Meetings be held
abroad? |
| The
Companies Act, 1956 is silent on this issue. However eminent
authors suggest that al least two meetings be held in India and two
abroad. |
|
TOP |
|
| Can a shareholders meeting be held
abroad? |
| No.
The Companies Act, 1956 clearly stipulates that the shareholders
meeting of an Indian company be held only within the postal limits
of the city where the companys registered office is situated.
However an extraordinary meeting of the shareholder not being the
annual general meeting of the company can be held abroad, because
the Act does not specifically state that the extraordinary meeting
must be held in India. |
|
TOP |
|
| What are the annual compliances for a private limited
company? |
| A
private limited company should file every year with the Registrar of
Companies an Annual Return along with a copy of the Balance Sheet
and Profit and Loss Statement. Together a Report of the Board
of Directors and the Report of the Auditors should also be
filed. |
|
TOP |
|
| Can a private limited company be incorporated without
a physical location (address) in India? |
| No. |
|
TOP |
|
| Is it required for the
applicants/subscribers/promoters of a limited company to be
physically present in India during the incorporation process?
Thereafter should any of the applicant/subscriber/promoter reside in
India while the company is active? |
| No. |
|
TOP |
|
| Is there a fixed financial year for a private limited
company or can a private limited company chose its own financial
year? |
| The
standard financial year in India is 1st April till the
succeeding 31st March. A private limited can opt for a
different financial year other than the above for the purposes of
Company law compliances. However for the purposes of income
tax filings and income tax payments the standard financial year
cannot be changed. |
|
TOP |
|
| Are any approvals required to be obtained for a
foreign company or a foreign individual to hold shares in an Indian
company? |
| Most
of the business sectors have been thrown open for foreign
participation to the extent of 100%. There are only a handful of
sectors where foreign investment is restricted to less than 100%.
Further most business sectors have been put under the automatic
approval route, which means that the foreigners / foreign companies
can remit the investment for the shareholding into India first and
later approach the Reserve Bank of India for permission of the
foreign holding. This liberalized scheme removes all bottlenecks and
greatly reduces the time taken for a foreign company or a foreign
individual to kick start their business ventures in
India. |
|
TOP |
