Public Limited Company Registration in India
A Public Limited Company (PLC) is a corporate entity recognized under the Companies Act, 2013, that offers limited liability to its shareholders and is authorized to offer its shares to the general public through stock exchanges. This structure is ideal for large-scale businesses aiming to raise substantial capital from public investors, thereby enhancing growth potential, brand visibility, and credibility. While a PLC is subject to stricter regulatory and compliance requirements, it enjoys key benefits such as easy transferability of shares, wider funding opportunities, improved corporate governance, and an enhanced market reputation, making it suitable for ambitious enterprises seeking long-term scalability.
When to Consider Forming a Public Limited Company
Opting for a Public Limited Company is beneficial in the following cases:
- Capital-Intensive Ventures – Businesses requiring substantial capital investment, such as manufacturing, infrastructure, and large-scale trading, can raise funds through public share offerings.
- Expansion Plans – Companies planning to scale operations at a national or international level benefit from public funding and market credibility.
- Enhanced Credibility – A public company structure boosts trust among investors, suppliers, lenders, and consumers, making it easier to secure funding.
- Attracting Investors – A PLC has the ability to issue shares and bonds, which makes it more attractive for institutional and retail investors.
Easier Loan Approvals – Financial institutions prefer lending to public limited companies due to their transparency and structured corporate governance.
Essential Documents for Public Limited Company Registration
To register a Public Limited Company in India, the following documents are required:
For Directors and Shareholders:
- Identity Proof – PAN Card for Indian nationals; notarized or apostilled passport copy for foreign nationals.
- Address Proof – Utility bill (electricity, water, or gas), Aadhaar card, voter ID, or driving license (not older than two months).
- Passport-sized Photographs – Recent passport-size photographs of all directors and shareholders.
For the Registered Office:
- Proof of Address – Electricity bill, water bill, or property tax receipt of the registered office.
- No Objection Certificate (NOC) – If the office is on rented premises, the property owner must provide an NOC for company registration.
- Rent Agreement – Required if the registered office is rented.
Other Mandatory Documents:
- Memorandum of Association (MoA) – Document outlining the company’s mission, vision, and objectives.
- Articles of Association (AoA) – Document defining the rules, structure, and operational guidelines of the company.
- Director Identification Number (DIN) – Unique identification number for all directors, obtained by filing Form DIR-3 with the Ministry of Corporate Affairs (MCA).
- Digital Signature Certificate (DSC) – An electronic signature required for filing incorporation documents online.
Declaration of Compliance – A declaration confirming that all rules and regulations under the Companies Act have been met.
Step-by-Step Process for Registering a Public Limited Company
The registration process involves multiple steps to ensure compliance with government regulations:
1. Obtain Digital Signature Certificate (DSC):
- Directors must acquire DSC to sign official documents electronically.
2. Apply for Director Identification Number (DIN):
- Directors must apply for DIN by submitting Form DIR-3 to the MCA.
3. Name Reservation:
- File Form INC-1 to reserve a unique company name.
- Ensure the name aligns with the business objectives and follows MCA naming guidelines.
4. Drafting of MoA & AoA:
- Prepare Memorandum of Association (MoA) and Articles of Association (AoA).
- These define the company’s structure, objectives, and operational rules.
5. Filing of Incorporation Forms:
- Submit Forms INC-7 (Application for Incorporation), DIR-12 (Appointment of Directors), and INC-22 (Registered Office Notice) along with the required documents.
6. Certificate of Incorporation:
- Once verified, the Registrar of Companies (RoC) issues the Certificate of Incorporation, legally recognizing the Public Limited Company.
7. Obtaining Business Commencement Certificate:
File Form INC-21 with the RoC to obtain the Certificate of Commencement of Business before starting operations.
Advantages of a Public Limited Company
✔ Limited Liability – Shareholders’ personal assets remain protected against business risks.
✔ Capital Acquisition – Ability to raise substantial funds from the public and institutional investors.
✔ Transferability of Shares – Shares are freely transferable, increasing liquidity for investors.
✔ Enhanced Credibility – A public company structure enhances market reputation and investor confidence.
✔ Growth & Expansion – Access to capital enables business expansion and diversification.
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Frequently Asked Questions (FAQs)
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+1. What is a Public Limited Company ?A Public Limited Company (PLC) is a business entity that can raise capital from the general public by issuing shares while offering limited liability protection to its shareholders.
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+2. How many directors are required to form a Public Limited Company ?A minimum of three directors is required to register a Public Limited Company.
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+3. What is the minimum number of shareholders for a Public Limited Company ?At least seven shareholders are required for registration.
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+4. What is the minimum capital requirement ?A Public Limited Company must have a minimum authorized share capital of ₹5 lakhs.
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+5. Can a Public Limited Company be listed on the stock exchange ?Yes, Public Limited Companies can be listed on stock exchanges like BSE and NSE to raise public funds.
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+6. What are the compliance requirements ?A PLC must hold annual general meetings, file financial statements, and submit returns to the MCA and SEBI.
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+7. Can a foreign national become a director in a Public Limited Company ?Yes, a foreign national can be a director, but at least one director must be an Indian resident.
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+8. Is it mandatory to appoint an auditor ?Yes, every Public Limited Company must appoint a statutory auditor within 30 days of incorporation.
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+9. What are the tax implications of a Public Limited Company ?A PLC is taxed at 22% (plus cess & surcharges) under the corporate tax regime.
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+10. Can a Public Limited Company convert into a Private Limited Company ?Yes, a Public Limited Company can be converted into a Private Limited Company by following the legal process under the Companies Act, 2013.
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+11. How long does it take to register a Public Limited Company ?It typically takes 10-15 working days, depending on document verification and approvals.
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+12. Can a Public Limited Company own property ?Yes, a PLC is a separate legal entity and can own property in its name.