Incorporating a company in India

1
Incorporating a company in India

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2
How can you define a company?

•  A company, in common parlance, means a group of
  persons associated together for the attainment of
  a common end, social or economic.

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3
How does law defines a company?

• According to sec. 3 (1) (ii) of the Companies
  Act, 1956 a company means a company formed and
  registered under the Companies Act, 1956 or any
  of the preceding Acts. Thus, a Company comes into
  existence only by registration under the Act,
  which can be termed as incorporation.
•  

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4
Advantage of incorporating a company in India

• Independent corporate existence
• Limited liability
• Perpetual succession
• Common seals
• Transferable shares
• Separate property
• Capacity for suits
• Professional management

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5
Disadvantage of incorporating a company

• Lifting of corporate veil
• Determination of character
• For benefit of revenue
• Fraud or improper conduct
• Agency or trust or government company
• Under statutory provisions

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Continued

• Formality and increase in expense
• In SC held that a company though a legal person
  is not a citizen neither under the provisions of
  the Constitution nor under the Citizenship Act.

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7
What is necessary to incorporate a company in
India

• To register the company following documents are
  necessary -
• 1) Memorandum of Association.
• 2)   Articles of Association, if necessary.
• 3)   A copy of the agreement, if any, which the
  company proposes to enter into with any
  individual for his appointment as the managing or
  the whole-time director or the manager.
• 4)   A declaration that all the requirements of
  the Act have been complied.

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