Private Company- Definition, Registration, and Advantages

Starting new business is one of the rewarding and most amazing experiences for the startups. Making the business plans, budgetary or financial planning, establishing the company, running the business, and enjoying the profit, all this seems very exciting. The most difficult decision made by a person while putting the step in the competitive market world is selecting the main business entity. The decision should be taken after considering all the requirements because it has long term implications for all over the life-cycle of business. Private company is best option for you if don’t want to start the business alone.slider_01

If several questions are running in your mind regarding what kind of business is this, how to do Private Company Registration, its advantages, and so on then read on this article. Here, you get the useful answer of most of your questions.

What is private company?

This is a privately held type of small business entity that limits owner liability to its members and shares. It is formed by only few people privately having individual legal entity. Minimum two members and maximum of two hundred are required to incorporate this company. It can be recognized with several identifying marks such as management, name, formation, and numbers of members, directors, meetings, shares, and others. Shareholders cannot sell the shares publicly without the approval of others. This business entity limits the right of the members to transfer the share or shareholders from publicly trading it.

The maximum numbers of directors need to be declared in the AoA (articles of association). The shareholders of the company must be the natural person or company. Minimum of two and maximum of 15 directors are required to start the business but they need to be more than 18 years of age.

What capital is required to start the company?

Minimum authorized capital required to start the private company in India is Indian Rupees 100,000. The upper limit or maximum amount of capital required is not defined exactly.

Procedure of Private Company Registration in Delhi

  • Getting Digital Signature Certificate and Director Identification Number for the proposed directors
  • Checking name availability and applying for its approval
  • File an eForm/new user registration
  • Incorporate the private company

On reading this, it will seem very easy but executing all the procedures step by step along with handling other works of business becomes very difficult. Thus, it is recommended to take the services from the reputed company providing private company registration.

Documents required for registration

Copy of identity proof and address proof such as driving license, adhaar card, etc are mandatory for all the proposed directors. Copy PAN Card and six passport size photographs of all the directors are also required for company registration.


Private company is very popular form of business entity because of its several amazing characteristics and advantages. Let’s have a look at its main advantages:

  • Restricted shares trading
  • Continue existence
  • Limited liability
  • Separate legal entity
  • No need to keep index of members
  • Minimum subscription
  • Tax advantages

If you have decided to incorporate the private company then you can consult with the leading company who provide the complete information and assist in doing the registration.

One comment

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