Company Formation under The Companies Act, 2013
A company can be formed by subscribing to a Memorandum of Association (MOA). Minimum person required to form a Company varies in different kinds of companies, such as:
- Public company: Seven or more persons.
- Private company: Two or more persons.
- One Person Company: One person, with provision for nomination.
Relevance of Incorporation
- Shield from Liability.
- Establish Perpetual Existence and Transfer of Ownership.
Incorporation Procedure: Section 7 of the Companies Act, 2013
Section 7 of the Companies Act, 2013 defines Incorporation Procedure. It prescribes documents and information needed, such as:
- Memorandum and Articles of Association.
- Declarations confirming legal compliance.
- Correspondence address and member details.
- First directors’ interests and consent.
Registration Process:
- Submit documents to the Registrar.
- Registrar registers and issues a Certificate of Incorporation.
- Corporate Identity Number (CIN) is allotted.
- Keep copies at the registered office.
Memorandum of Association (MOA)
MOA is a foundational document defining the company’s relationship with shareholders, specifying objectives. It includes:
- Name Clause
- Situation/Registered State Clause
- Object Clause
- Liability Clause
- Capital Clause
- Subscriber Clause
Articles of Association (AOA)
AOA, regulating internal affairs, includes regulations, matters inclusion, provisions for entrenchment, and outlines director appointment and removal.