Registering a Public Limited Company in India: Legal Process, Compliance & Benefits

A A public limited company is a type of company that can offer its shares to the public through a stock exchange. It has a wider shareholder base compared to a private limited company and is subject to more stringent regulations.

A The key differences include:
• Share Transfer: Public companies can freely transfer shares, while private companies have restrictions.
• Number of Shareholders: Public companies have no limit on shareholders, while private companies have a maximum of 200.
• Public Offer of Shares: Public companies can invite the public to subscribe to their shares, while private companies cannot.
• Regulations: Public companies face more stringent regulatory requirements and disclosures.

A Public limited companies can be broadly categorized into:
• Listed Companies: Companies whose shares are listed and traded on a stock exchange.
• Unlisted Companies: Companies that have offered shares to the public but are not listed on a stock exchange.

A Advantages: Access to larger capital through public offerings, enhanced credibility, greater visibility, and liquidity for shareholders.
Disadvantages: Higher compliance burden, increased transparency requirements, potential loss of control for promoters, and greater scrutiny.

A A minimum of seven members and three directors are required.

A A director must be:
• An individual (not a company).
• At least 18 years old.
• Not disqualified under the Companies Act.
• Possess a Director Identification Number (DIN).
• Meet other specific criteria outlined in the Companies Act.

A Yes, NRIs and foreign nationals can be directors, but certain regulations and documentation requirements apply.

A A unique identification number assigned to individuals who are appointed or want to be appointed as directors of any company. It is mandatory for all directors.

A While the Companies Act, 2013, removed the minimum paid-up capital requirement, it is still advisable to have an adequate authorized capital, typically starting with Rs. 5 lakhs or more for a public limited company.

A The fee payable to the MCA for registering the company, which varies based on the amount of authorized capital.

A Yes, a registered office address is mandatory for a public limited company. This is the official address for all legal and communication purposes.

A No, the incorporation process is primarily online through the MCA portal. Physical presence is usually not required.

A The documents typically include:
• Memorandum of Association (MoA)
• Articles of Association (AoA)
• Declarations from directors
• Proof of registered office address
• PAN and Aadhaar card copies of directors
• Nominee consent (if applicable)

A The incorporation process usually takes a few weeks, depending on MCA processing times and completeness of documentation.

A The incorporation is valid indefinitely (perpetual succession) unless the company is wound up.

A Public limited companies have numerous compliances, including:
• Annual filing of returns (MGT-7, AOC-4)
• Holding Annual General Meetings (AGM)
• Maintaining financial records
• Conducting board meetings
• Complying with tax regulations
• Complying with SEBI regulations (if listed)

A Yes, NRIs and foreigners can hold shares, subject to FDI guidelines and other applicable regulations.

A FDI in India is governed by specific regulations, including sectoral caps and approval requirements. It's crucial to consult with professionals to ensure compliance.

A See steps outlined in company registration process.

A No minimum paid-up capital, but adequate authorized capital is recommended.

A Access to capital, enhanced credibility, etc.

A Through networking, investment banks, online platforms, etc.

A SEBI regulations, listing agreements, etc.

A Through stock exchanges or as per company procedures for unlisted companies.

A A document offering securities for sale to the public.

A Initial Public Offering, when a company first offers shares to the public.

A Adhere to MCA naming guidelines and ensure uniqueness.

A As per Income Tax Act, GST Act, and various other RBI and SEBI compliances. Contact us for advice on taxation perspective of the company.