A public limited Company is a business organisation that trades on a public stock exchange and has its shares available to the general public. Hence, the Public Limited Companies have to comply with multiple regulations of the government and start a Public Limited Company To register a Public Limited Company in India there should be a minimum of seven members and there is no limit on the maximum number of members/shareholders for starting a Public Limited Company.
Limited liabilities for the shareholders of the company: The shareholders of a Public Limited Company are given limited liability protection. In a situation of unexpected liability, the same would be limited only to the company and the not affect the shareholders in any way.
Perpetual Succession: A public limited company is considered as a corporate body that has perpetual succession. Means in case of death, retirement, insanity, and insolvency of one or more members/ shareholder/ directors, the company still continue its existence.
Multiple avenues of funding: A public limited company raises funds from individuals as well as from financial institutions. The funds may be also raised in equity shareholding, preference shareholding, or debentures.
Borrowing Capacity: A public company can enjoy unlimited sources for borrowing funds. It can issue equity, debentures and can accept the deposits from the general public by selling its shares. Moreover, most of the financial institutions find public companies more prominent than other unregistered companies.
Better opportunities for growth and expansion of the company: Fewer risks lead to better opportunities so that the company can grow and expand by investing in new projects from the funds raised by selling its shares in the market.
Annual General Meeting: Annual General Meeting has to be held following Section 121(1) of the Companies Act, 2013. Form MGT-15 has to be filed once the AGM has been conducted
Financial Statements: The Financial Statements of the Company have to file as per Section 137 of the Companies Act,2013, read with Rule 12(2) of the Companies (Accounts) Rule,2014. The Financial statement consists of the balance sheets, cash flows statements, Director’s statement, Director’s report, Auditor’s report, and the combined financial state, meaning which is prepared in XRBL (Extensible business reporting system). This is filed via Form AOC 4
Annual Return: This has to be filed following Section 92 of the Companies Act.2013 read with the Rule 11(1) of the Companies (Management and Administration) Rules,2014. The Annual return contains the information about the directors and shareholders and is required to be filed in Form MGT7 with the relevant ROC.
Financial and Director’s Report: Adoption to the financial and director’s report is to be done in consonance with Section 173 of the Companies Act read with the Secretarial standard 1. The filing is done via form MGT 14.
Income Tax Returns: This is to be filed with the Tax department in form ITR 6 on or before September 30th of the financial year
Secretarial Audit Report: Submission of the Secretarial report is a requirement under Section 204 of the Companies Act,2013 read with Rule 9 of the Companies Rules,2014. The secretarial report has to be submitted only when the Company’s total paid-up capital is equal to or crosses Rs. 50 crores or the annual turnover is equal to or exceeds INR 50 crores or the annual turnover is exceeding Rs.250 crores. This filing did via Form MR 3
Board Meetings: An unlisted Public Limited Company is required to hold at least 4 board meetings in compliance with Section 173 of the Companies Act,2013.
Appointment of a Cost Auditor: The auditor is required to be appointed as per Section 148(3) along with Rule 6(2) and Rule 6(3A) of the Companies Rules,2014. For this form, CRA 2 is to be filed. It is pertinent to mention that the original appointment of the auditor should be done within 30 days of the Board meeting or 180 days of the financial year, whichever is earlier. When a casual vacancy arises the same is to be filed within 30 days.
Return of Deposits: Returns of deposits have to be filed with the ROC under whose jurisdiction the company falls via Form DPT 3 in compliance with rule 16 of the Companies (Acceptance of Deposit) Rules,2014.
Appointment of CFO or CS or CEO: Section 203 read with Rule 8 and Rule 8A of the Companies Rules,2014 requires the appointment of the CFO or CS or CEO within 30 days of the AGM or 6 months in case of the casual vacancy. Form MGT 14 or Form DIR 12 are filed.
Annual General Meeting: AGM for the declaration of the dividend has to be conducted in compliance with Section 96 of the Companies Act, 2013.
CSR Committee: CSR Committee has to hold four meetings with a gap of not less than 120 days between the two meetings held for discussion and approval of the CSR activities. This is done under the Companies Act,2013 read with Companies Rule,2014 and Secretarial Standard.
Director’s Disclosure: Directors are required to disclose any financial interest in the Company via Form MBP 1 in compliance with Section 184(1) of the Companies Act,2013 read with Rule 9(1) of the Companies (Meetings of Board and its Powers) Rules,2014.
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