What is a private limited company?

A private limited company is privately held for small businesses. This type of business entity limits the owner's liability for its shareholding, the number of shareholders to 200, and restricts shareholders from publicly traded shares.

private-limited-company-Private Limited Company Benefits

The private limited company is a very old-school concept for a privately held small business unit.

About 93 percent of the companies incorporated in India are registered as private limited companies. Don't you think that something would be "better as I thought" because of such benefits so many people choose a private limited company over so many other types of registrations?

If we consider the characteristics to be prudent, then a private limited company is a registered company that limits the liability of the owner to the contribution given by him, only to the value of the shares held by him, it will increase the number of shareholders/members to 200. And restricts shareholders from publicly trading their shares.

But who understands all these technologies ..? At least when we are not about to start a business ..! At this stage we should know why I should register my business as a private limited company ..? Or why should I join a private limited company?

One may ask why should I register a company when I can run my business exactly like (a proprietary firm) .. ???

This is where we can help you understand the POSITIVES of registering your business as a private limited company.

Director or member

There will be at least 2 members to start a private limited company. Don't you think it's always best to have a partner (s) who knows what is going through your mind? This person can help you add more perspectives to this business idea, help expand the idea - possibly in the right direction, you may actually have what you lack - place, people, money or smartness! And much needed, this person can bring in contacts, so of course, you can reach more than the people in your contact list - whether it is for ideas or for FUNDS - you never know!

Now it has a limit. You cannot have more than 200 members. But who needs many ..? You certainly do not want this kind of chaos in the early stages. right! In the future, if you feel that the company needs more members, we can do so, but it is not required at the moment… not now!

Furthermore, not only an individual, even an entity can become a member of a private limited company.

Limited liability

The liability of each member or shareholder is limited to the contribution made by them. A very difficult but extremely powerful tool to understand a private limited company. This can literally change the table for you!

When you are a proprietor you only deduct the profits, profits, and assets of the business in full and similarly, you are solely responsible for all its losses, debts, and liabilities. Suppose you have taken a loan for this business and, God forbid, but if you fail to repay the loan taken for this business or any other loan, then you are liable to pay these debts. , Regardless of its performance. In this case, if the property of the business is not enough, the creditor can take your personal property - jewelry, land, any other items - to pay off the debt in full. Basically, you finally got robbed!

The same is the case with a partnership firm or maybe worse because in the case of a partnership firm, you are equally liable for your partner's actions. This means, if the other partner takes a loan for the business, you are equally and personally liable to pay the full loan. And they don't even care whether you were aware of this loan/loan/loan!

Perpetual succession

Since a company is a separate legal entity, the law also exists in case of death, bankruptcy or insolvency of any of its members.

It helps to understand. If you have a proprietary business or partnership business, you and your businesses are one and the same. No difference is there. But the registration of the company makes your business a separate legal entity and in relation to this business, you (founder/member / director) are separate entities. Thus, if you register/join a company with MCA (Ministry of Corporate Affairs) then your company attains a different legal status. Due to this, the life of the company does not depend on the life of its founders or its members. Even if the members, for that matter also all the members, become bankrupt/bankrupt,

Private Limited Company Registration Required Documents


To register a private limited company, the proposed directors of the company have to submit the following documents as proof of identity:

For Indian citizens - PAN
For Foreign Nationals - Passport
The proposed director may submit the following documents as proof of address:
For Indian citizens - Passport / Driver's license /