Private Limited Company Subsidiary

FDI in Indian Private Limited Company

Due to its favorable business exposure, growth potential and sophisticated financial structuring. Private Limited Companies are thought to be the best business form that can be registered in India. Unlike partnerships, they also make it easier to raise capital from financial institutions because of their higher stability and reliability. With its doors open to Foreign Direct Investment, the Indian market provides Foreign Nationals and NRIs with a comfortable and advantageous business environment. Alternative organizational structure such as proprietorships, partnership firms, and one-person companies are prohibited from accepting foreign direct investment (FDI), while FDI in limited partnerships (LLPs) requires prior RBI clearance. NRIs, or foreign nationals, may own shares of the company, subject to FDI regulations.

Foreign direct investment (FDI) cannot be accepted by alternative organizational structure such as proprietorships, partnership firms, or one-person businesses. FDI in limited partnerships (LLPs) must first receive RBI approval. Subject to FDI restrictions, NRIs, or foreign nationals, may own shares in the business. In India, a private limited company has two directors at the very least, one of whom needs to be an Indian citizen. In India, a private limited company needs to have a minimum of two Directors and two Shareholders. A corporate entity or an individual can be a shareholder. However, a director must be a individual. MCA has not restricted any citizen of particular nation from becoming Directors, it’s just that they need to have security clearance from Ministry of Home Affairs, Government of India (national of a country which shares a land border with India) 

Benefits of Private Limited Subsidiary Company in Delhi India

• Distinct Legal Entity: A corporation created in accordance with the Act has the unique characteristics of a legal entity and a juristic person. As a result, a business form of organization has broad legal authority, the ability to possess property, and the ability to incur debt. For such obligations, a company's directors and shareholders are not liable to the company's creditors.
• Continuous Existence:  A firm has perpetual succession, that is continuing or unceasing existence until it is lawfully dissolved. A company's continued existence is unaffected by the passing away or other departure of any of its members because it is a distinct legal entity.
• Borrowing Capacity: An organization benefits from improved financing options. It has the ability to take public deposits, issue both secured and unsecured debentures and more. When providing large financial aid to a corporation, banks and other financial institutions prefer it to company than partnership enterprises or proprietary concerns.
• Foreign Direct Investment: In numerous industries, companies are permitted to receive 100% Foreign Direct Investment (FDI) without requiring prior government approval. However, FDI is not permitted in proprietorships or partnerships. Instead, LLPs require prior government approval.
• Share Transferability: A shareholder may transfer their shares to any other individual by simply filling out and signing a share transfer form, then transferring the shares to the new owner along with a share certificate. This is applicable to small private limited companies.
• Owning Property: As a distinct legal entity, a company is able to purchase, own, use, and transfer property under its own name. As long as the company continues to operate, no shareholder may assert any rights about its assets.
• Limited Liability: The legal designation "limited liability" designates the capacity to be held solely accountable for a portion of a company's debts. In contrast to partnerships and proprietorships, members of limited liability companies have limited liability with regard to the debts of the business.

Capacity to sue and be sued: To file a lawsuit is to file a case in a court of law or to start legal procedures against someone. A firm, being a separate legal entity, has the right to sue and be sued in its own name, just as an individual can bring a lawsuit in that person's name against another.

FDI Investment Entry Routes in Delhi India

Automatic Route:

Foreign investment in industries or activities covered by the automatic route is exempt from prior government and Reserve Bank of India permission. Investors only need to complete the necessary paperwork with the relevant RBI regional office within 30 days of receiving inward remittances and inform the concerned regional office within 30 days of issuing shares to international investors.

Government Route:

FDI in activities not covered under the automatic route requires prior Government approval.

FDI Subsidiary Company Registration Procedure in Delhi India

1. COMPANY NAME: Request name approval.
2. DSC: Acquire Digital Signature Certificate.
3. MOA AND AOA: Creating the Association's Articles and Memorandum of Association.
4. FILING: Completing the corresponding E-forms for the MOA and AOA and signing them with the Registrar of Companies.
5. CERTIFICATE OF INCORPORATION: Acceptance of the ROC's Certificate of Incorporation.

Documents Required for Subsidiary Company Registration in Delhi India

Documents needed to establish a Private Limited Subsidiary Company in India.

Indian Directors:

• One color image  of the prospective director.
• The PAN Card copy of the director.
• The Indian government issue’s identity documents such as passports, voter identity cards, driver's licenses, and Aadhaar cards.
• The address proof (bank statement, electricity bill, phone bill, mobile bill) that you provide to the Indian government should not be more than two months old.

Foreign Directors:

• Four color photographs of the director.
• A fully notarized copy of the passport and attested by a public notary or by the appropriate government in the nation where it was issued.
• Identity Proof (driving license, residence card, bank statement, or official identification document with address issued by the government) that has been properly notarized by a public notary or apostilled by the appropriate authority in the nation in which it was issued.
• Residential Proof (Mobile bill, phone bill, electricity bill, bank statement) all needs to be notarized and apostille.
• A PAN undertaking is also required by the foreign Directors.

For Registered Address in India:

• The title paperwork for the office space registered in the company's name is registered.
• The lease or rent agreement in the company's name, notarized, and a copy of the rent payment receipt that is no more than a month old.
• A certificate of no objection from the property's owner.
• Utility bill not older than 2 months is also required for registered office

Indian and Foreign Shareholders:

• Identity proof (Passport, Driving License, Aadhaar Card, PAN Card, Bank Statement, government-issued form of identification containing address)
• Address proof (Bank Statement, Electricity Bill, Telephone Bill, Mobile Bill).
• In case of foreign national, MOA and AOA subscriber page is also required to be notarized and apostille.