Private Limited Company
A Private Limited Company is a business entity held by small group of people. It is registered for pre-defined objects and owned by a group of members called shareholders or stakeholders. Startups and businesses with higher growth aspiration popularly choose Private Company as suitable business structure.
The business entity gets recognized as a Company through its registration with the Registrar of Companies, known as the ROC, formed under Companies Act of 2013 in India. The governing body is Ministry of Corporate Affairs, widely known as MCA.
The registration process takes 15 working days after all information and documents are received. Company's PAN and TAN are allotted along with the certificate of incorporation, enabling business owners to start the business immediately.
Characteristics of Private Limited Company
Members
To start a company, a minimum number of 2 members are required and a maximum number of 200 members are allowed
Limited Liability
The liability of each member or shareholders is limited. It means that if a company faces loss under any circumstances then its shareholders are not liable to sell their own assets for payment. The personal, individual assets of the shareholders are not at risk. The Liability of the Shareholders is limited to the extent they have Invested in the Company
Perpetual succession
The company keeps on existing in the eyes of law even in the case of death, insolvency, or bankruptcy of any of its members. This leads to the perpetual succession of the company. The life of the company keeps on existing forever.
Paid-up capital
The Companies Act, 2013 has done away with any minimum amount of capital required to start the company. A Private Limited Company can now be incorporated with as low as Re. 1 of Capital.