A Pvt.Ltd Company Offers Limited Liability and Independent Legal Status.
Public Limited Company is a business entity that offers its shares to the general public and is listed on a stock exchange. It enjoys greater access to capital but operates under strict regulatory compliance to protect shareholders’ interests.
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A Public Limited Company in India is a business entity where shares are made available to the public, and shareholder’s liability is limited to their investment. While not all Public Limited Company shares are listed or traded on stock exchanges, the company can choose to list its shares by complying with the relevant regulatory requirements.
- Legal and Regulatory Framework
- Reasons to Choose Public Limited Company:
- Minimum Requirements
- Documents Required
- Advantages after Incorporation
- Compliance Requirements
The Ministry of Corporate Affairs (MCA) oversees the entire registration process, ensures adherence to statutory requirements, and regulates corporate governance standards.
SEBI Regulations: Including LODR (disclosures and corporate governance), ICDR (capital raising), Insider Trading, and Takeover Regulations.
Compliance with Stock Exchange Rules: Specific operational and regulatory standards of the exchange (e.g., BSE, NSE).
Listing Agreement: Ensuring the company adheres to the terms agreed upon with the stock exchange.
Enhanced Credibility: Public companies are perceived with higher trust in the market.
Limited Liability Protection: Shareholders’ liability is restricted to their investment in shares.
Growth Potential: Suitable for large-scale businesses looking for expansion.
Flexible Share Transferability: While shares may not always be listed, they can still be transferred or sold privately.
Company Name: Must be unique and comply with naming guidelines.
Directors: At least 3 directors, with at least 1 being a resident director.
Registered Office: Must have a local registered office within the country.
Shareholders: Minimum of 7 shareholders, with no maximum limit.
Passport-sized photographs of all directors & members.
Proof of registered office (e.g., electricity bill, rent agreement).
Digital Signature Certificate (DSC) for directors.
Enhanced Credibility and Trust: Public companies enjoy greater market recognition and credibility.
Higher Valuation: Public companies often achieve higher market valuations. Increased Access to Capital: Public companies can raise significant capital through public offerings or private placements, even without stock exchange listing.
Investor Confidence: Enhanced transparency and accountability make the company more attractive to investors.
Limited Liability Protection: Shareholders are protected from business liabilities beyond their shareholding.
Perpetual Succession: The company continues to exist despite changes in shareholders or directors.
Annual Returns (Form MGT-7 or MGT-7A): Filed with MCA within 60 days of the AGM.
Auditor Appointment (Form ADT-1): Appoint an auditor within 30 days of incorporation, with annual audits required.
Board Meetings: Minimum of 4 meetings annually.
Director KYC (Form DIR-3 KYC): Annual KYC for all directors.
Director’s Report: Prepared and submitted along with financial statements in Form AOC-4.
Financial Statements (Form AOC-4): Filed annually with the MCA.
GST Filings (if applicable): Regular GST return filings (GSTR-1, GSTR-3B).
Income Tax Filing (ITR-6): Filed annually with the Income Tax Department.
Statutory Registers: Maintain mandatory registers for members, directors, charges, etc.
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