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From the Vakilkaro blog
Practical guides on registration, trademark, tax, NGO and compliance — written and reviewed by our legal team.
Business RegistrationsMinimum Capital Requirement for a Private Limited Company
The Companies Act, 2013 has removed the mandatory minimum capital requirement for a Private Limited Company, allowing businesses to start with any amount of capital. Previously, a minimum paid-up capital of ₹1 lakh was required, but now companies can determine their capital based on operational need
Business RegistrationsMaximum Directors in a Private Limited Company
A Private Limited Company must have at least two directors and can appoint up to 15 directors as per the Companies Act, 2013. However, this limit can be exceeded by passing a special resolution in a general meeting. Directors play a crucial role in corporate governance, compliance, and decision-maki
Business RegistrationsMaximum Number of Directors in a Private Company
As per the Companies Act, a private company must have a minimum of two directors and can appoint a maximum of 15 directors. However, the limit can be increased by passing a special resolution in a general meeting. Directors play a crucial role in managing the company’s affairs, ensuring compliance,
NBFC & FinanceIncorporation of a Company under Companies Act, 2013
The incorporation of a company under the Companies Act, 2013 involves several key steps, including selecting a business structure, obtaining Digital Signature Certificates (DSC) and Director Identification Numbers (DIN), reserving a unique company name through the MCA portal, drafting essential docu
Business RegistrationsCan One Person Form Both an OPC and an LLP?
A single person can initiate both one person company registration and limited liability partnership registration, but specific legal conditions apply. One person company registration allows sole ownership with limited liability, while limited liability partnership registration requires at least two
Business RegistrationsCan a Private Limited Company be Converted into an LLP?
A Private Limited Company can be converted into a Limited Liability Partnership (LLP) under the LLP Act, 2008, by meeting legal requirements. Businesses that have undergone Private Limited Company registration often opt for this transition for lower compliance costs, tax benefits, and operational fl
Business RegistrationsImpact of the death of Shareholder in a Private Limited Company
When a shareholder of a private limited company passes away, the company's structure and operations can be affected significantly. Typically, the deceased's shares would be transferred according to their will or, in the absence of one, by the laws of intestacy. This transfer can lead to changes in o
Business RegistrationsAre there any tax benefits for Private Limited Companies?
Private Limited Companies can take advantage of various tax benefits that enhance their financial efficiency. These may include deductions for operational expenses, exemptions on certain types of income, and tax incentives for investments in specific sectors. Additionally, these companies often bene
Corporate AdvisoryLok Sabha Corrected the Errors in the Income Tax Bill 2025
The Lok Sabha has issued a corrigendum for the Income Tax Bill, 2025, addressing formatting errors, reference corrections, and legal citation refinements. Key changes include modifying section numbers, correcting typographical errors, and ensuring consistency in terminology. References to the repeal
Business RegistrationsHow to Close or Dissolve a Pvt Ltd Company or LLP
Closing a Private Limited Company (Pvt Ltd) or a Limited Liability Partnership (LLP) in India involves legal procedures under the Companies Act, 2013, and LLP Act, 2008. Businesses can opt for voluntary strike-off, liquidation, or tribunal-ordered closure based on financial or strategic reasons. The
Business RegistrationsThe Role of a Company Secretary in Private Limited Companies
A Company Secretary (CS) plays a vital role in ensuring legal compliance, corporate governance, and smooth operations in a Private Limited Company. They handle regulatory filings, maintain statutory records, conduct board meetings, and act as a liaison with government authorities like the MCA, SEBI,
Corporate AdvisoryReformation and Streamlining Income Tax Legislation of India
India's Income Tax Act, 1961, has undergone extensive amendments over the years, making it complex and difficult to navigate. To address these challenges, the government has introduced a new Income Tax Bill aimed at simplifying tax laws, enhancing legal clarity, and ensuring ease of compliance. By e
NBFC & FinanceCan an NBFC Change Its Core Activities After Registration?
An NBFC can change its core activities after registration, but it requires approval from the Reserve Bank of India (RBI). The process involves submitting a detailed business plan, financial projections, and a board resolution. The RBI reviews the application to ensure the new activities comply with
Business RegistrationsCan LLP partners be held personally liable?
Limited Liability Partnership (LLP) partners generally enjoy limited liability, meaning they are not personally responsible for the LLP’s debts or obligations. However, there are certain circumstances where partners can be held personally liable. These include situations where a personal guarantee i
Business RegistrationsWhat happens if an OPC owner wants to sell the business?
When an OPC owner decides to sell the business, they must follow a structured process that includes business valuation, due diligence, and negotiating terms with the buyer. The ownership, assets, and liabilities of the company are transferred, often involving the sale of shares. Key steps include up
Can a Private Limited Company Operate Without a Director?
A Private Limited (Private Limited) company cannot operate without at least two directors, as mandated by the Companies Act, 2013. Directors are essential for governance, compliance, and decision-making, ensuring that the company meets legal obligations like filing annual returns and maintaining fin
Business RegistrationsPrivate Limited vs Limited Liability Partnership: Tax Differ
The tax differences between a Private Limited Company (Pvt Ltd) and a Limited Liability Partnership (LLP) primarily lie in the way profits are taxed. Pvt Ltd companies are taxed at 30% on profits, and dividend distributions are subject to Dividend Distribution Tax (DDT). They also face Minimum Alter
How Long Does It Take to Register a Company?
The time required to register a company varies based on the business type, country, and completeness of documents. For example, registering a Private Limited Company in India can take 7–15 days, while a Sole Proprietorship may take just 1–3 days. Key steps include obtaining a Digital Signature Certi
NBFC & FinanceCosts Involved in Company Registration in India
The cost involved in company registration in India involves various costs, including government fees, professional charges, and other expenses depending on the business type. Government fees vary based on authorized capital, with additional costs for digital signature certificates (DSC) and director
NBFC & FinanceWhat Is the Penalty for Non-Compliance by an NBFC?
Non-compliance by Non-Banking Financial Companies (NBFCs) in India can result in severe penalties imposed by the RBI. These penalties may include monetary fines, suspension of operations, cancellation of deposit-taking licenses, and even the cancellation of the NBFC’s license in extreme cases. Viola
Can an NBFC Operate in Multiple States?
Yes, NBFCs can operate in multiple states in India, provided they comply with RBI regulations and state-specific laws. Expanding to multiple states offers benefits like increased market reach, diversified portfolios, and revenue growth. However, it also comes with challenges such as higher complianc
NBFC & FinanceCan Foreign Entities Register as NBFCs in India?
Foreign entities can register as Non-Banking Financial Companies (NBFCs) in India by complying with regulatory requirements set by the Reserve Bank of India (RBI) and the Foreign Direct Investment (FDI) policy. Foreign investment is allowed up to 100% in NBFCs, with certain sector-specific caps. The
NBFC & FinanceCompliance Requirements After NBFC Registration
Non-Banking Financial Companies (NBFCs) must adhere to ongoing compliance regulations set by the RBI after registration. These include maintaining capital adequacy, submitting quarterly and annual financial reports, ensuring proper governance, and following prudential norms. Regular audits, liquidit
NBFC & FinanceCan an NBFC Convert into a Bank?
NBFCs in India can convert into banks by following a regulated process governed by the RBI. Conversion offers benefits like access to public deposits, enhanced credibility, and a broader range of services. NBFCs must meet strict eligibility criteria, including minimum net worth, strong corporate gov