Public Limited Company Registration in Ahmedabad, Gujarat – Features, Difference, Process, Eligibility Criteria, Benefits, Disadvantages, Documents Required

Overview of Public Limited Company registration in Ahmedabad, Gujarat

Starting a business of your own may be a huge accomplishment for you to finally gather courage & take a leap of faith in the right direction regardless of its scale of operations. But, you would want to ensure that you choose a business structure that could offer maximum benefits for you and you might want to look for options to choose from. Accordingly, if a business entity will need huge capital investments, may opt to be registered as a Public Limited Company in Ahmedabad, Gujarat.

But, what is a Public Company? As per Section 2(71) of the Companies Act, 2013 a Public Company means a company that is not a private company. Further, a private company that is a subsidiary of a Public Company shall be deemed a Public Company.

In other words, a Public Limited Company is a company that doesn’t meet the definition of a private company i.e. it has at least seven members and at least three directors on its board and there is no upper ceiling for the maximum number of members as in the case of a private company.

Incorporation of a Public Limited Company with the Ministry of Corporate Affairs online portal grants legal recognition as well as affords all other privileges that are allowed to a body corporate such as limited liability, perpetual succession & a separate legal status. Not only this, a Public Limited Company is permitted by the law to raise capital from the public in general by listing their shares in a public stock exchange in India as well as from abroad.

However, since there is a larger amount of public interest involved in a Public Limited Company, it is often subject to more stringent compliances with many of the restrictive provisions of the Companies Act.

Public Limited Company in Gujarat

Located on the western coast of India, Gujarat has the longest coastline in India. It is the fifth-largest state in terms of area and the 9th most populous state in India. It shares boundaries with Rajasthan, Dadra and Nagar Haveli, Daman and Diu, Maharashtra, and Madhya Pradesh. The indigenous people of the state are known as Gujarati, and the official language of the state is Gujarati. Gujarat encompasses 23 sites of the Indus valley civilization, which is one of the oldest civilizations. Gujarat has the fourth-largest economy in India, with a Gross State Domestic Product (GSDP) of rupees 19.4 trillion. In Indian states and union territories, the human development index Gujarat ranks 21st. Traditionally, the state has a low unemployment rate and is considered one of India’s most industrially developed states and manufacturing hubs.
The major industrial cities in Gujarat are Ahmedabad, Surat, Vadodara, Rajkot, Bhavnagar, and Jamnagar. The Ahmedabad city of Gujarat was ranked 3rd on the list of Forbes 2010 world’s fastest-growing cities.
Capital- Gandhinagar

The startup ecosystem of Gujarat
According to the ‘State and Union Territory Startup Ranking Exercise 2019,’ Gujarat is the best performer. Gujarat has a well-structured startup ecosystem that focuses explicitly on incubation regulatory support and awareness. The Gujarat startup policy focuses on the initiatives to build a robust startup ecosystem in the state. Under the ‘Industries and Mines Department,’ the Gujarat government launched the state startup policy in 2015. The policy was drafted to provide benefits and incentives to startups across various areas of intervention. By drafting outline sector-specific startup policies like ‘Electronics and Information Technology (IT) policy and ‘The student Startup and Innovation Policy (SSIP), Gujarat has become one of the few states in the country that designs sector-specific startup policies. The startup ecosystem of Gujarat is already powerful because of the prominent startup incubators and accelerators.
Some significant aspects of the startup ecosystem in Gujarat or as follows: –
For the development of a strong startup ecosystem, the Gujarat government has assigned the industries and mines department as the nodal department for startups. The nodal officer for startups is the industries commissioner.
The government is using educational institutions as a platform to launch some of the most prominent incubators and co-working spaces in India, such as I create, Venture studio, The address, and Dev X.
The Student Startup and Innovation Policy (SSIP) designed by the Gujarat government have the following objectives: –
The policy aims to build a capacity for at least 200 premier educational institutes in the state.
Through the policy, the government tries to support at least 1000 student-led innovations every year to encourage students into entrepreneurship.
The policy aims to create at least one percent of graduates into job creators and business owners.
The policy vision is to harness 500 student startups in the upcoming five years.
And through the policy, the Gujarat government files at least 100 patents from universities every year.

Top business ideas in Gujarat
With a population of 60 million people, Gujarat is registered as the third-largest source of India’s Gross Domestic Product (GDP). The significant growth sectors in Gujarat are industrial service and farming. Gujarat has an excellent transport network and access to a vast platform of transportation and communication. The state is traditionally famous for business people who have founded some of India’s largest enterprises. Setting up a business in Gujarat is a great idea, and if you are looking for the best business options in Gujarat, then here are a few: –

Papad Production
Papad is among the traditional dishes of Gujarat. The city is famous for its culinary ingredients prepared with dal, perfect as a small snack. Papad belongs to Gujarat’s traditional cuisine that attracts many foreigners because of its different flavors. Setting up a Papad production business in Gujarat is a small-scale business that needs less investment and can help make huge profits. For setting up a Papad production business, you need skilled workers, and the raw materials required for starting this business are available locally.

Salt production
Gujarat shares the longest coastline, providing enough resources to start a salt production business. The raw material required for salt production is locally available around the coastline. By collecting the right components in appropriate amounts, you can set up a salt production business in Gujarat. The salt production business in Gujarat requires a considerable investment and will help you gain long-term profits.

Ethnic wear business
The customs and culture of Gujarat are very vibrant and colorful. One can easily set up an ethnic wear shop in Gujarat where they can sell the traditional dandiya dresses and ethnic dresses of Gujarat. Foreign nationals who come to visit Gujarat like to purchase such attire. The ethnic wear business requires low investment and can be started with the help of local artisans.

Agrochemical industry
The primary crop of Gujarat is cotton which holds nearly ten million hectares of the state’s total 19 million hectares. Gujarat has a high demand for agro-based goods like seeds, machinery, fertilizers, etc. so setting up an agrochemical industry in Gujarat is a good startup idea. For setting up an agrochemical industry in Gujarat, you need a considerable amount of investment.

Pickles and jams business
If you have any knowledge about preparing pickles and jams from scratch, then opening a pickles and jams business is the ideal business option for you. Gujarati people are pickle lovers, and their food is incomplete without pickles, so this business can help you yield huge profits. This business doesn’t need a lot of investment and can be started by hiring a few people.

Gujarati Snacks
If you want to set up a business in Gujarat, then what can be best than Gujarati snacks. Gujarati snacks are very popular in India, so you should try your hands on the Gujarati snacks business. To start a Gujarati snack business in Gujarat, you can hire local people, and this business needs low investment.

Gems and Stones business
You can gather some exquisite and unique stones and gems locally around the coastline. The state is naturally endowed with a long coastline that provides gems and stones. To set up gems and stone business, you need a reasonable investment, and this business can make you huge profits. You can collect those unique gems and stones and sell them in the market for profit.

Salient Features of a Public Limited Company registered in Ahmedabad, Gujarat

Number of Directors

Unlike a One Person Company or a private limited company, the primary requisite for starting a public limited company which will need at least three directors with no upper ceiling for the maximum number of directors.

Body Corporate

Since a Public Limited Company is a body corporate it enjoys limited liability, perpetual succession, and a separate legal status apart from its members in the eyes of law. Accordingly, in the event of debts or losses, the liability of any member could not go beyond his agreed contribution which is unlike in the case of a partnership firm or a sole proprietorship firm where the partners and business owners are jointly and severally liable for the debts of the business.

Paid up Capital

To start a Public Limited Company, there must be a minimum paid-up capital of Rs. Five or any higher amount prescribed by the Government under the Act.

Addition of word ‘Limited’ with name

Unlike a private company, which adds a ‘private limited’ after its name, every Public Limited Company must add ‘Limited’ after its name in every official publication.

Difference between Private & Public Limited Company registered in Ahmedabad, Gujarat

There are several differences between a private & Public Limited Company registered in Ahmedabad, Gujarat which have their own advantages & disadvantages in each of them. Hence, every entrepreneur may choose their business structure before establishing their company by analyzing each concept in depth. The primary differences have been provided below-

Process of Public Limited Company Registration Online in Ahmedabad, Gujarat

Step 1-Obtain DSC for the proposed Company in Ahmedabad, Gujarat

As a first step towards registration in Ahmedabad, Gujarat, the company should first obtain a class 3 category digital signature certificate from a government-recognized certifying authority available online, which takes around one or two days. DSC is the most important part of filling incorporation application online with MCA as it enables the company to e-verify its documents & attachments online.

Step 2- Make an application for allotment of DIN in Ahmedabad, Gujarat

Next, at least three directors of the proposed directors of the Public Limited Company will be required to obtain DIN to become directors of the company. Basically, there are two ways to apply DIN from the MCA portal-

i. File a separate application for DIN allotment through DIR-3 in Ahmedabad, Gujarat

The Form DIR-3 is an e-form filed for the purpose of making an application online for the allotment of DIN for a single individual director who wishes to become a director in an existing company. To file this form, proof of identification such as PAN, Aadhaar Card, etc, and address proof of the proposed director are required.

ii. Apply for DIN through the incorporation form SPICe+ in Ahmedabad, Gujarat

From 23.02.2020, the proposed director of a new company who is going to become a director for the first time could apply for DIN allotment within the SPICe+ form for up to three directors and doesn’t need to file the form separately.

Step 3-File the multipurpose form SPICe+ for incorporation in Ahmedabad, Gujarat

The SPICe+ form for the incorporation of a new company which came into effect on 23 February 2020, is a multi-purpose web-based application that not only facilitates the incorporation of the company but also offers facilities in two parts A & B for –

• Application for allotment of DIN (up to three directors)
• Reservation of company name (RUN)
• Application for PAN and TAN (mandatory)
• Application for EPFO registration (mandatory)
• Application for ESIC registration (mandatory)
• Application for Professional tax registration (for Maharashtra only)
• Application for opening a bank account (mandatory to file)
• Allotment of the GST identification number (GSTN)

To start the process of incorporation, all these e-forms have to be downloaded in PDF format, filled & signed digitally, and submitted online. Further, the user has also to download & fill SPICe+ form and affix a digital signature followed by a certification of the fulfillment of all compliances from a professional such as CA/CS or CMA. There is no fee applicable for the incorporation of a company with less than 10Lakhs of authorized capital.

Step 4- Filling & Submission of MOA & AOA in Ahmedabad, Gujarat

Next, the proposed company needs to file the drafted Memorandum of Association (MOA) & the articles of association (AOA) of the company in e-format. Memorandum & Articles of Association which represent the primary charter of the company as well as its bye rules for internal organization. The format for MOA & AOA has been prescribed in the form e-MoA (INC-33) and e-AoA (INC-34) respectively. After putting digital signatures by the subscribers to the Memorandum and Articles of Association, they could be submitted.

Earlier, the MOA & AOA needed to be filed physically, but now these have also been integrated with the incorporation form SPICe+.

Step 5-Approval & Getting COI in Ahmedabad, Gujarat

After submission of the SPICe+ form along with all required documents & attachments, the MCA authority will carry out verification of the documents & on being assured of its genuine, may issue the Certificate of Incorporation which contains a unique CIN number along with PAN & TAN number & other unique identification numbers as allotted after approval of the SPICe+ Form by way of an email on the registered e-mail address.

Eligibility Criteria for Public Limited Company Registration in Ahmedabad, Gujarat

i. Minimum amount of shareholders & directors- To start a Public Limited Company, the company needs to have at least seven members who subscribe to the Memorandum of Association of the company and at least three directors on its board. Though, there are no restrictions regarding the maximum number of directors or members a Public Limited Company can hold.

ii. Resident Director-The another requirement to start a Public Limited Company in India is having at least one resident director i.e. who has resided for at least 182 days during the immediately preceding year irrespective of their citizenship, who will be primarily responsible for the compliance of the company. It is to be noted that the number of days required for the calculation of 182 days could be in phases.

iii. Registered Office Address-Every Public Limited Company should have a temporary address at the time of registration of the company for communication purposes. Further, within a period of 30 days, the company needs to have a registered office address and proof of address must be submitted online.

iv. Unique Name of Company– For the purpose of eligibility, the company so proposed should be unique i.e. it should not be too closely similar to any already existing business and should not be a name in violation of the National Emblems Act 1950. The name of the company should suggest its business objectives which could be either a single objective or a multifaceted object.

v. Legal Object– The proposed company shall also have a legal object of business for its incorporation and not for any illegal purpose or posing any not misuse or harm the society, which should be described in the object clause of the Memorandum of Association (MOA) of the company.

vi. DIN for all Directors- As provided under sections 153 and 154 of the Companies Act, 2013, the Director Identification Number is a unique number mandatorily required to be obtained by a director in a company by making an application to MCA in e-form DIR-3.  However, for a first-time director for a new company, an application for DIN allotment could be made along with the incorporation form SPICe with MCA.

vii. Digital Signature Certificate (DSC)-Since all the documents & attachments have to be filed online, it will be mandatory for the directors of the Public Limited Company to obtain a DSC. A DSC helps to verify the authenticity of filling documents filed & submitted during incorporation and thereafter.

viii. Certificate of Compliance– After all the documents are drafted & prepared, the prospective Public Limited Company will need to obtain a certificate of compliance from a professional such as a CA/CS/CMA, that all the declarations for incorporation of a Public Limited Company have been genuinely made.

Benefits of Public Limited Company Registration in Ahmedabad, Gujarat

i. Limited Liability- Unlike a partnership firm, a Public Limited Company is a legal person whose assets& liabilities are separate from its members and thus the members of the company have limited liability towards the debts of the company, which cannot go beyond their agreed contribution to the capital of the company made by them in correspondence to the nominal value of their shares.

ii. Transparent & trustworthy– Since there is a larger public interest involved in a Public Limited Company in the form of investment, hence it is subject to higher compliances such as fillings of financial statements & annual returns, the Government demands more transparency from such companies in the form of compliances and intimations about changes from time to time.

iii. Easier Transfer of Shares- As per the provisions of the Companies Act 2013, the members in a Public Limited Company have no maximum limit, thus the shares of a Public Limited Company could be easily transferred from one person to the other. Especially for listed public companies, the prices of shares are quoted on a stock exchange, thus it is easier for anyone to sell or buy shares in the company

iv. Perpetual Succession– Unlike a partnership firm, a Public Limited Company enjoys perpetual succession, which means irrespective of the events like death, insolvency or any disability of its partners shall not affect its legal status. It continues to live until & unless it is legally dissolved through the prescribed procedures.

v. Ease to raise funds- A Public Limited Company having more members than any other business entity has access to more capital which also helps them in obtaining loans from banking & financial institutions and even from investors who join as a shareholder. Due to this, they can even enter negotiations to demand favorable rates of interest and conditions for repayment of loans. Additionally, a Public Limited Company can also offer debt securities for the purpose of extra funds for business expansion purposes.

vi. Better Growth and Expansion Opportunities-Compared to any other business entity, a Public Limited Company has several sources of gaining capital such as the fresh issue of shares, issue of debt securities, and loans from banks & financial institutions, there is always a strong probability of strong market presence and growth opportunities. Thus, it is significantly easier for a Public Limited Company to expand its business operations and get growth opportunities as compared to entities like private companies or LLPs who have to work relatively harder to raise funding or get investments.

Disadvantages of a Public Limited Company registered in Ahmedabad, Gujarat

1. Higher cost of Compliances– As aforementioned, in the case of a Public Limited Company, there is more public interest attached to the business management decisions and their consequences. Accordingly, it has to fulfill more compliances than other business entities, and hence there are higher costs of compliances.
2. Problems with Decision Making- Unlike a private company, where the number of members is limited, the number of shareholders is significantly larger, and no key decision related to the business could be made without the approval of shareholders. Thus, for making any business decision, the board of directors has to lay it in front of the shareholders and pass a resolution for carrying matters forward, which takes a longer time & effort.

Documents Required For Public Limited Company registration in Ahmedabad, Gujarat

i. Proof of Identification of all the proposed members and directors;

ii. Proof of residence of all the proposed directors and shareholders.

iii. Address Proof for the proposed registered address of the company such as utility bills.

iv. PAN Card of the proposed members;

v. In case the office property is rented, a NOC from the owner of the property

vi. Copy of proposed memorandum & articles of association of the company;

vii. DSC (Digital Signature Certificate) & DIN (Director Identification Number) of all the proposed directors.

Conclusion of Public Limited Company registration in Ahmedabad, Gujarat

Therefore, a Public Limited Company registered in Ahmedabad, Gujarat is a business entity that allows benefits of better funding & growth opportunities for entrepreneurs, which could be incorporated by following a simple and convenient process. So, get your company incorporated and start your journey today.