In order to get a company registered or incorporated, the following procedure is to be adopted:
(A) Preliminary Activities:
Before a company is incorporated, the promoter has to take decision regarding the following:
1. To decide the name of the company:
A company may adopt any name it likes provided the name does not closely resemble with the name of any other company and is not identical. To take approval of the name an application is filed with the Department of Company Law Administration, Government of India through the Registrar of Companies of the State concerned. The application should be filed with the prescribed fee and as many names as possible should be given in it.
2. Licence under Industries Development and Regulation Act, 1951:
An application for the licence should be made to the Secretary, Minister of Industrial Development of India, New Delhi. The application is submitted only in case when the company’s business falls under the scope of the Act.
(B) Filing of Document with the Registrar:
In order to get the company registered, the following documents should be presented to the Registrar of Companies.
1. Memorandum of Association:
It is signed by at least seven persons in case of a public company and two persons if it is a private company. It must be properly stamped.
2. Articles of Association:
This document is signed by all those persons who have signed the Memorandum of Association. The filing of Articles of Association is essential in the case of unlimited companies, company limited by guarantee and private companies limited by shares.
In case of public company limited by shares it is not compulsory to register Articles of Association along with the Memorandum of Association. If no articles are registered by a public company limited by shares, the provisions of Table A in schedule I of the Act will automatically apply.
3. List of directors:
A list of directors with their names, addresses and occupation is to be prepared and filed with the Registrar of Companies.
4. Written consent of directors:
A written consent of the directors that they have agreed to act as directors has to be filed with the registrar along with a written undertaking from him to the effect that he will take from the company his qualification shares and will pay for them.
5. Statutory declaration:
A statutory declaration by (a) any advocate of the Supreme Court, or (b) of a High Court, or (c) an attorney or pleader entitled to appear before a High Court, or (d) a chartered accountant practising in India, who is engaged in the formation of the company, or (e) by a person named in the articles as a director, managing director, manager or secretary of the company that all the requirements of the Act and the rules there under have been complied with.
When the required documents have been filed with the Registrar along with the prescribed fee, the registrar scrutinizes the documents. If he is satisfied, the name of the company is entered in the register. Now the Registrar will issue a certificate known as Certificate of Incorporation under his signature, in token of registration of the company. The issuance of this certificate is the conclusive evidence of the fact that the company is incorporated and the requirements of the Companies Act have been complied with.