Whether you are a budding entrepreneur or a businessman, you might be harbouring dreams of starting your own company. You might even be thinking about applying for a loan by approaching a bank or an NBFC. However, before you begin the process, it is important that you are aware of the requirements and timelines. Registering a company can be an arduous task, but it is vital in establishing a business. The time taken to register a Private Limited Company (Pvt. Ltd.) can differ based on various factors.

What is a Private Limited Company

In simple words, a private limited company is a small business entity with limited liability for its owners. It is held by private stakeholders and forms a separate legal entity from its shareholders. For this reason, it can own property or borrow money in its own name.

How long does it take to register a Private Limited Company

Coming to the time it takes to register a private limited company, the entire process can take 10-30 business days, provided all the documents are submitted correctly. The time period also depends on the workload at the government office. Let us now take a closer look at the various stages in the registration process, the average time taken for each stage, and the factors that can affect the registration time.

Stages involved in registering a private limited company

1. Getting the Digital Signature Certificate and Director Identification Number: The first step involves obtaining the Digital Signature Certificate (DSN) and Director Identification Number (DIN) for all the directors. This step can take anywhere between 1 and 2 days.
2. Name availability: After obtaining the DSN and DIN, you must apply for name availability with the Registrar of Companies (ROC). This is a fairly straightforward process and takes 2-3 days.
3. Drafting the MoA and AoA: One of the most important steps in the entire process, you must next draft the Memorandum of Association (MoA) and Articles of Association (AoA). This step can also take around 2-3 days.
4. Filing of incorporation documents: In the next step, you must file the incorporation documents, including Form SPICe and Form URC-1, with the Registrar of Companies. SPICe refers to the Simplified Proforma for Incorporating Company Electronically, while the Form URC-1 refers to the Application by a company for registration u/s 366. It might take around 6-8 days to complete this step.
5. Getting the Certificate of Incorporation: The Registrar of Companies will verify the incorporation documents. Afterwards, the ROC will issue a Certificate of Incorporation (CoI) after 2-3 days.

Thus, the total time taken to register a private limited company is 10-30 business days. Let us look at the various factors that can influence the time taken to complete the registration process.

Factors affecting the time taken for registration

In India, various factors can affect the time taken to register a private limited company. These include:

• Name availability: One of the most crucial steps during the registration process is naming the company. However, if the name proposed by you is already taken or is very similar to an existing entity, it may disrupt the process, delaying the time it takes to get the name approved by ROC.
• Correctness of documentation: If the documents you submitted for the company’s registration are erroneous or incomplete, it can significantly delay the approval time, as you will have to submit the correct documentation.
• State of registration: In India, certain states boast faster registration times for private limited companies than others. Thus, the state of registration also dictates the registration time.
• Government processing time: Another factor that dictates the registration time is the government takes to process your application. This primarily depends on the workload at the government office.
• Availability of professionals: Registering and setting up a private limited company is a complicated and time-consuming process. You must hire lawyers, CAs, or company secretaries if you wish to speed up the registration process. However, their availability and the fees they charge can also affect the registration time.

Conclusion

If you wish to establish a private limited company, whether as an online marketplace or one with a physical presence, you must first get it registered. Depending on several factors, such as the accuracy of the submitted documents and the availability of the name, the time taken to register the company can range from 10 days to around 30 days. It is important that you keep this in mind before starting the registration process.