Legal Requirements to Start a New Company

A company becomes a legal entity simply after its enlistment with the Registrar of Companies. Various legal procedures must be completed before a solicitation is made to the Registrar for its enrolment. After guaranteeing that every fundamental report is recorded, the Registrar of organizations gives a Certificate of Incorporation. With this Certificate, the company turns into a separate legal entity.

The following are the various legal procedures involved in the making of a company.

Application for the approval of a chosen name

The initial phase in getting a company incorporated is of acquiring the approval for the chosen name from the Registrar of Companies. A company may receive any name which isn’t denied under the Emblems and Names (Prevention of Improper Use) Act, 1950 and which isn’t indistinguishable with or doesn’t intently look like the name of a company as of now is enlisted.


The candidate should give a board of three names to maintain a strategic distance from the delay. The application for the endorsement of the name ought to be sent the Registrar of Companies of the state, wherein, the Company is to be put up. The Registrar is required to favour the name within 14 days of the receipt of the application.

The proposed name must be enlisted within 3 months from the date of approval by the Registrar. In case of failure to comply with such direction, the promoter should apply again to the Registrar for the revalidation of the chosen name for the company.

Preparation of the memorandum of association

The preparation of the Memorandum of Association is the next stage in the making of a company. It is the constitution of the company, which depicts its items and scope and the connection with the outside world. The memorandum is to be signed by seven people if it is a public limited company and in the case of a private limited company, there must be minimum of two signatories. The memorandum ought to likewise be stamped accordingly.

Preparation of the articles of association

Other than a memorandum, the promoters will likewise have to plan and prepare the Articles of Association. It is a record which contains rules and guidelines identifying with the inward administration of the company.

A public limited company may not record its Articles of Association, it might receive model statements recommended in Table A, Schedule 1 of the Companies Act 2013. A private limited company is additionally required to present its Articles appropriately marked by the signatories.

requirementsfornewcompanyThe readiness of different reports

The promoters are additionally expected to set up the accompanying reports at the hour of incorporation of the company:

(I) The assent of executives is gained first and recorded with the Registrar of Companies.

(ii) The promoters ought to execute a Power of Attorney for one of them or a backer who is to do the conventions required for enrolment.

(iii) Copies of the preliminary understandings, memorandum and Articles of Association should likewise be arranged and recorded at the hour of enrolment.

(iv) The company is required to have an enrolled/ registered office and the data of the same is to be recorded with the Registrar within 30 days of its enlistment or from the date of initiation of business, whichever is prior.

(v) Where the company names its first directors in some of its Articles, their points of interest are to be submitted with the Registrar within 30 days of its enrolment or arrangement of such executives.

(vi) A statutory presentation that every single legal necessity for enrolment/ incorporation has been conformed to is additionally documented with the Registrar at the hour of enlistment. The announcement must be marked by any Supreme Court or High Court lawyer or pleader of High Court or a practising Chartered Accountant.

At the hour of enlistment, recommended enrolment charges and recording expense for each report petitioned for enlistment are to be paid at the Registrar’s office. The charge to be paid fluctuates with the measure of the nominal Capital in case if the company has a share capital. In case the company does not have a share capital, the charge varies based on the number of members in the company.

Certificate of incorporation

At the point when all the necessary reports are recorded with the Registrar alongside the imperative expenses, an examination is made. At the point when all archives are found all together, the Registrar will enter the name of the company in the Register of Companies and issues a Certificate of Incorporation. The date referenced in the endorsement is the date of the incorporation of the company.

This blog is Written by Jonica E


Jonica is a law student, author and blogger. You can reach her at [email protected]

Follow Jonica on Instagram

Also Read: Startup Advice For Aspiring Female Entrepreneurs



Please enter your comment!
Please enter your name here