A Public Limited Company is a Company limited by shares in which there is no restriction on the maximum number of shareholders, transfer of shares and acceptance of public deposits. The liability of each shareholder is limited to the extent of the unpaid amount of the shares face value and the premium thereon in respect of the shares held by him. However, the liability of a Director / Manager of such a Company can at times be unlimited. The minimum number of shareholders is 7.
A public limited company is a company that is able to offer its shares to the public. Advantages of a public limited company would include; profits are bestowed upon the company's shareholders, there is improved national insurance benefits, easy to transfer interest in business through ownership of shares.
A public limited company is a form of business organization that operates as a separate legal entity from its owners. It is formed and owned by shareholders. Shares of a public limited company are listed and traded at a stock exchange market freely. Shareholders of a public limited company are limited to potentially lose only the amount they have paid for the shares they own.
NOTE: The directors can also be the share holders.
Step I : Getting DIN
DIN can be obtained by making an application online. All the existing and intending Directors have to obtain DIN within the prescribed time-frame as notified in Sections 266A to 266G of Companies (Amendment) Act, 2006.
Step II : Getting DSC
Digital Signature can be obtained from any of the Certifying Authorities in India. It is required as all the filings done by the companies under MCA21 e-Governance programs are need to be filed online with the use of Digital Signatures by the person authorized to sign the documents.
Step III : Pre- Name Application Search
Step IV : Drafting Of MOA & AOA
MOA is a document that sets out the constitution of the company. It contains the main objectives, incidental/ ancillary objectives for the attainment of the main objectives, other objectives and the scope of activity of the company and also describes the relationship of the company with the outside world.
AOA contains the rules and regulations of the company for the management of its internal affairs. It states the authorized share capital of the proposed company and the names of its first/ permanent directors.
NOTE : While the Memorandum specifies the objectives and purposes for which the Company has been formed, the Articles lay down the rules and regulations for achieving those objectives and purposes.
Step V : Representations before RoC on behalf of Promoters
Changes to be made in the Name application, if any, suggested by the RoC
The ROC will issue Certificate of Incorporation after careful review of documents submitted in the above stated steps. Section 34(1) cast an obligation on the ROC to issue a Certificate of Incorporation, normally within 7 days of the receipt of documents. A Public Limited Company can start its business immediately on receiving the Certificate of Incorporation.