Formation of a Company and its Important Documents...

        As we all know that large scale businesses are carried out through Companies . We are going to look after the formation of Joint Stock Companies.

A) Stages in the formation of a Company :-

1) Promotion of a Company :-

Promotion of a Company means taking all the necessary steps to Incorporate a Company as per the Companies Act , 2013 . Promoters are the persons who undertake the entire process of Promotion of a Company . They are the one who come up with the idea of starting a business . The two main documents for Incorporation of a Company i.e Memorandum of Association and Articles of Association are prepared by them . Important documents during Incorporation are as follows :

i] Memorandum of Association :-

It is a primary document of a company which states the purpose for which the company is formed . Every company needs to prepare its Memorandum of Association at the time of its Incorporation and submit it to the Registrar of Companies . It is prepared by the Promoters and needs to be signed by minimum a) 1 person - in case of a one person company . b) 2 persons - in case of a private company . c) 7 persons - in case of a public company .

ii] Articles of Association :-

Articles of Association is the second most which needs to be submitted to the Registrar of Companies along with the Memorandum at the time of Incorporation of a Company . It defines the powers , rights and duties of the directors and also the manner in which the business of the Company will be carried on . Articles is a legal document which contains rules and regulations which helps in internal management of a company . 

2) Incorporation of a Company :-

Incorporation of a Company is the 'Birth Certificate' of a Company i.e the company comes into existence after receiving the Incorporation Certificate from the Registrar of Companies . The promoters decide whether to form a private company or a public company depending upon the objectives of a company and the amount of capital needed .

i] Following steps are undertaken during the Incorporation of a company :-

Obtaining Digital Signature Certificate (DSC)

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Register DSC in the name of Director with Ministry of Corporate Affairs (MCA)

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Obtain Director Identification Number (DIN)

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Apply for Reservation of Name

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Finalize Memorandum and Articles of Association 

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Signing , Stamping and Dating of Memorandum and Articles of Association 

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Deciding address for communication

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Filing of documents for Incorporation with Registrar of Companies (ROC)

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Obtaining Certificate of Incorporation