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Frequently Asked Question

Q1: Categorisation of company as per Companies Act 2013.

Ans: Company classification can be Public Company or Private Company

Q2: How many people are required to form a company?

Ans: Minimum 2 people are required to format a Private Limited Company and minimum 7 people are required to format a Public Limited Company named as promoter or shareholder of the company. As per recent amendment in law even a single individual can format a company known as one man Company which will be classified as a Private Company.

Q3: Do a relative of promoter can be a member in a company?

Ans: Yes, relative of promoter can be a member in a company (i.e. Relative-Spouse, Brother, Sister, Father Mother etc.)

Q4: What is the minimum amount of investment required for formation of a comapany ?

Ans: Minimum investment required for a Private Limited Company is Rs 1 Lac and Rs 5 Lac for a Public Limited Company.Investment will be in the form of subscription to equity shares of the company.

Q5: Do the functioning of the company limited to state in which registered address of the company is there?

Ans: Company once registered in a specific state can function in whole of India by opening up its branches in respective State or Union territory

Q6: Do bank account in company name has to be separately opened?

Ans: Yes, Current A/c in company name will separately open in any Bank.

Q7: Do registration with any other authority is need before starting the functioning of the company?

Ans: Industry specific registration has been prescribed by various State & Central Laws

Q8: How we determine the owner ship in the company?

Ans: Ownership of the company is defined on the basis of total % shares held by each shareholder of the company.

Q9: Who will be Directors in a company?

Ans: Directors are the Authorised representatives of the company minimum 2 Director are required to be appointed in a Private Limited Company and 3 Directors in a Public Limited Company.Directors can even be the shareholders in the company.

Q10: Do a person who is employment /job can format a company?

Ans: Yes, Company law does not prohibit person who is in employment cannot be a Director in a company. If the employment agreement which the individual has executed prohibits on accepting any other appointment then he cannot.

Q11: Do any kind of business is possible in the company?

Ans: No, Company object is defined as per the Memorandum of Association of the company which at the time of incorporation has to be clearly defined company cannot function in sector other than those as defined in the main object however the company can change its objective clause by following certain procedural requirement.

Q12: Can a Foreigner or a NRI can format a company?

Ans: Yes, on complying with certain procedural requirement.

 
 
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