Tag Archives: incorporation

delhi shops & regn act

Registration under the Delhi Shops & Registration Act, 1954 is now integrated with the company incorporation under MCA portal in sPICe format – i.e. at one step a company can be incorporated as well its PAN/ TAN/ GST/ EPF/ ESIC registrations done. Besides bank a/c opening and professional tax regn under certain state laws are also integrated. First time registrants under the aforesaid Delhi Shops & Registration Act, can avail of this single window facility. It is only when they have to register their other offices or branches that they need to go to a separate portal for the same i.e. https://labourcis.nic.in

The relevant notification is given below:

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incorporation

MCA has vide its circular dated 24th December, 2020 amended the Companies (Incorporation) Rules, 2014 by giving more leeway to the name reservation, which at present is only 20 days time limit from the date of its approval.

Now they have provided that the applicants can extend the name reservation approval time limit by paying appropriate fees as under:

upto 40 days from the date of approval i.e. 20 days extra on payment of Rs.1000/-

upto 60 days from the date of approval i.e. 40 days extra on payment of Rs.2000/-

In both the above cases, the additional payment should be made before expiry of 20 days / 40 days respectively

upto 60 days from the date of approval i.e. 40 days extra on payment of Rs.3000/- if the payment is made before 20 days of the approval date.

All this is going to come into effect from 26th January, 2021 – though i am clueless why it should be so late, it should have been made applicable from 1st January 2021 itself.

This is a much needed move because the present 20 days’ time limit is vastly insufficient in order to submit/ file all the documents online at the web portal of the MCA and the govt. asks for a truckload of documents for the same.

In the Web form Spice B+ also they have introduced a column for indicating the main objects of the proposed company. Presently such indication has to be made in the attachment portion of the form.

A copy of the MCA circular can be found on the MCA site. i.e. http://www.mca.gov.in

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SPICe+ webinar

Clarifications from MCA officials in the webinar held today on SPICe+ incorporation forms

Ministry of Corporate Affairs has notified dated 18th February, 2020

Regarding Companies (Incorporation) Amendment Rules, 2020.

Shall come into effect from 23rd February, 2020

MCA has introduce SPICe+ and AGILE-PRO for incorporation of a Company

Before Notification After Notification
Spice, MOA, AOA, Agile  – PDF based form Spice+, MOA, AOA, Agile-pro  – web based form
RUN Spice+ Part A
INC-9 – Draft document INC-9 – Auto populated pdf. from MCA portal
For incorporation – Spice and other linked forms are to be filled For incorporation – Spice+ Part B and other linked forms are to be filled
All respective forms – in download pdf. format Once SPICe+ is filled completely with all relevant details, the same would then have to be converted into pdf format, with just a click of the mouse button, for affixing DSCs
Features:-

–          Incorporation

–          DIN Allotment

–          Mandatory issue of PAN

–          Mandatory issue of TAN

–          Allotment of GSTIN (if so applied for)

Features:-

–          Incorporation

–          DIN Allotment

–          Mandatory issue of PAN

–          Mandatory issue of TAN

–          Mandatory issue of EPFO registration

–          Mandatory issue of ESIC registration

–          Mandatory issue of Profession Tax registration(Maharashtra)

–          Mandatory Opening of Bank Account for the Company and

–          Allotment of GSTIN (if so applied for)

 

 

Rest all procedure remains the same as per earlier only the form version has changed and format.

 

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SPICe+

As part of Government of India’s Ease of Doing Business (EODB) initiatives, the Ministry of Corporate Affairs has notified a new Web Form christened ‘SPICe+’ (pronounced ‘SPICe Plus’) replacing the existing SPICe form. SPICe+ would offer 10 services by 3 Central Govt Ministries & Departments (Ministry of Corporate Affairs, Ministry of Labour & Department of Revenue in the Ministry of Finance) and One State Government (Maharashtra), thereby saving as many procedures, time and cost for Starting a Business in India and would be applicable for all new company incorporations.

Following are the features of the new Spice+ web form:

·         SPICe+ would be an integrated Web Form.

       ·         SPICe+ would have two parts viz.: Part A-for Name reservation for new companies and Part B offering a bouquet of services viz.

(i)                 Incorporation

(ii)               DIN allotment

(iii)             Mandatory issue of PAN

(iv)              Mandatory issue of TAN

(v)                Mandatory issue of EPFO registration

(vi)              Mandatory issue of ESIC registration

(vii)            Mandatory issue of Profession Tax registration(Maharashtra)

(viii)          Mandatory Opening of Bank Account for the Company and

(ix)              Allotment of GSTIN (if so applied for)

 

·           The new web form would facilitate On-screen filing and real time data validation for seamless incorporation of companies. For ensuring ease while filing, SPICe+ has been structured into various sections. Information once entered can be saved and modified.

 

·           Registration for EPFO and ESIC shall be mandatory for all new companies to be incorporated through SPICe+ and no EPFO & ESIC registration nos. shall be separately issued by the respective agencies.

 

·           Registration for Profession Tax shall also be mandatory for all new companies to be incorporated in the State of Maharashtra through SPICe+.

 

·           All new companies incorporated through SPICe+ would also be mandatorily required to apply for opening the company’s Bank account through the AGILE-PRO linked web form.

 

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incorporation

MCA amends the Companies (Incorporation) Rules by bringing in faster incorporation of companies in India. Salient features are as under:

  • Date of notification was on 6th February, 2020.
  • The said notification is issued by MCA with a view to amend the prior rules with respect to incorporation of a company.
  • The new rules shall be called as Companies (Incorporation) Amendment Rules, 2020.
  • And it will come into force with effect from the 15th February, 2020 which means that as of now the prior rules is still in effect i.e. Companies (Incorporation) Rules, 2014.
  • The main reason behind the new amendment rules is to reduce procedures, time and as well as cost for all the new company incorporations with effect from the 15th February, 2020.
  • MCA has taken a new initiative in ease of doing business by introducing new E-Forms for incorporation of all new companies i.e. Form SPICE+ and Form AGILE PRO.
  • Form SPICE+ will offer multiple services which is divided into 2 parts such as Part A for name reservation for new company and Part B as given below:
    • Incorporation
    • DIN allotment
    • Mandatory issue of PAN
    • Mandatory issue of TAN
    • Mandatory issue of EPFO registration
    • Mandatory issue of ESIC registration
    • Mandatory issue of Profession Tax registration (Maharashtra)
    • Mandatory opening of Bank Account for the Company and
    • Allotment of GSTIN (if required)
  • As per the Companies (Incorporation) Amendment Rules the Rule 9 of Companies (Incorporation) Rules, 2014 is also been amended which states that for reservation of name or change of name an application shall be made at the official site of MCA by using web service under SPICE+ and in case of change of name then by using web service under RUN along with the fees as provided in the Companies (Registration Offices and Fees) Rules, 20014.
  • It is to be noted that it shall be the discretion of the Registrar or Central Registration Centre for accepting or rejecting the application made as above. In case any defects arises in the application made as above then the same need to be rectified within 15 days.
  • In rule 10, 12, sub rule (1) of rule 19, sub rules (1), (2), (3), (4), (7), and (9) of rule 38 of prior rules wherever the words, letters, figures and bracket “Form No INC-32 (SPICE)” is appeared the words “Form No. INC-32 (SPICE+) shall be replaced with effect from the 15th February, 2020.
  • Also the rule 38 of prior rules has been amended and states that in the marginal heading, for the words, brackets and letters “Electronically (SPICE)” the words “Electronically Plus (SPICE+)” shall be replaced.
  • There has been a change made in rule 38A of prior rules which is relating to Form AGILE which will be known as AGILE PRO and also after clause (c) the new clause has been added i.e. clause (c) which is for Profession Tax Registration with effect from the 15Th February, 2020 and clause (d) which is for Opening of Bank Account with effect from 15th February, 2020.
  • New E –Forms has been replaced by prior forms i.e. in case of Form RUN, Form INC-32 (SPICE) and Form INC-35 (AGILE) the Form INC-32 (SPICE+) and Form INC-35 (AGILE PRO) has been substituted which will offered multiple services and it will results into cost cutting and time saving as compared to prior E-Forms.
  • E-Form INC-9 is also been replaced by E-Form known as RUN which will be used for the purpose of change of name only as of now.
  • Form No INC-33 is also been amended whereby the letters, words and brackets “MOA language 0 English 0 Hindi SRN for (RUN)” shall be deleted.
  • Also relatedly amendment is also made in Form No INC-34 where the letters, words and brackets “AOA language 0 English 0 Hindi SRN for (RUN)” shall be deleted.
  • Lastly in Form No URC-1 the words and letters “Form language 0 English 0 Hindi SRN of RUN” shall be deleted.

 

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Companies Act, 2013 – Commencement of Business

Under the Companies Act, 1956 a private company could start its business immediately upon receiving certificate of incorporation. They were not required to obtained a certificate of commencement of business under section 149 of that Act. 

Now under Section 11 of the Companies Act, 2013, ALL companies cannot commence business or exercise any borrowing powers, unless 

– the subscribers to the memorandum have paid in their subscription monies and a declaration to that effect has been filed with the Registrar and the paid up share capital of the company on the date of declaration is at least Rs.1 lakh for a private company and Rs.5 lakhs for a public company, AND

– the company has filed with the Registrar a verification of its Registered office. 

Section 11(3) further states that where no declaration has been filed within 180 days of the date of incorporation and the Registrar has reason to believe that the company is not carrying on its business or operations, he will initiate action for removal of the company name from the registrar of companies. 

 

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Draft Company Law Rules 2013 – Chapter II – Incorporation

 

1) The procedure for incorporation is more or less the same. The Rules lays down detailed guidelines for the same.
 
2) Rule 2.5(3) – if the company has changed its activities which is not reflected in its name, then it shall change its name in line with its activities by following the procedures for change of name – But who will certify or verify that the company has changed its activities – it is not clear, what constitutes change of activities. Private limited companies are allowed to carry on business specified in other objects as well. So does this mean that they are henceforth not allowed to do “other objects” business – clarity required on this clause
 
3) Rule 2.27(1)(h) – why there is a requirement of bank draft evidencing payment of fee – it can be made by online in the MCA 21 system and only the SRN quoted in the form.
 
4) Rule 2.27(2) Proviso – this is for change of registered office from one state to another – what happens when there is no Company Secretary in the company seeking change of registered office – therefore a PCS should be allowed to certify that the list of creditors is correct etc.
 
5) Rule 2.32 – definition of “electronic transmission” could very well have been made in the Act itself especially as (iii) says “any other means of electronic communication”. Besides the definition itself is appearing at two places in the same Rule
 
6) Lastly the devil lies in the forms – there are total 32 forms in this chapter itself – whether all the forms are required to be certified by professionals will be the moot question.
 
7) Remembering all the rules, sub rules, clauses, sub clauses is going to be one heck of a job!!
 
8) Lastly I feel that recognition given to chartered accountant and cost accountant while incorporating companies is ill advised – at the point of repeating ourselves we will say – it is not their core competency.
 
These are my observations on the Chapter II.     

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