Starting a proprietary concern or proprietary firm is a simple process. There is no formal registration to be done. An Individual / sole trader (or one person firm) intending to do business or profession, can register the concern under Goods and Service Tax Act (GST), Profession Tax Act or Shops and Establishment act or Udyog Aadhar (MSME)
Persons who have entered into a partnership with one another are called individually “partners” and collectively “a firm”, and the name under which their business is carried on is called the “firm-name”.
To commence a partnership firm, atleast two persons are required. The firm doesn’t have a separate legal entity like a company. The firm is a collective name given to individual partners.
A One Person Company (OPC) combines most of the benefits of a sole proprietorship and a company form of business. It has only one person as a member who will act in the capacity of a director as well as a shareholder.
OPC is formed as a Private Limited Company.
LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership.
The LLP is a separate legal entity, is liable to the full extent of its assets but the liability of the partners is limited to their agreed contribution in the LLP. Further, no partner is liable on account of the independent or un-authorized actions of other partners, thus individual partners are shielded from joint liability created by another partner’s wrongful business decisions or misconduct
Setting up a Private Limited Company in India requires a minimum of TWO shareholders and TWO directors. The shareholders can be the directors of the company. One of the directors, however, should be a Resident Indian.
Choosing the name of the company is a bit tricky! While choosing the name, one has to ensure that the Name
Does not resemble the name of any other already registered company
Does not violate the provisions of emblems and names (Prevention of Improper Use Act, 1950) by availing the services of checking name availability on the portal
Select, in order of preference, at least one suitable name upto a maximum of six names, indicative of the main objects of the company
Once the name is chosen, then file an application for the incorporation with Registrar of Companies (ROC), along with Memorandum and Articles of Association, particulars of directors, etc.
Digital Signature – All the directors have to mandatorily obtain the digital signature.
Once the application is processed by the Registrar of Companies, they will issue Incorporation Certificate mentioning a Corporate Identity Number (CIN)