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

Overview of Public Limited Company registration in Chandigarh, Punjab

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 Chandigarh, Punjab.

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 Punjab

Punjab is located in northern India; it shares national borders with Himachal Pradesh, Haryana, Rajasthan, Chandigarh, and Jammu & Kashmir, and the international border with Pakistan. Punjab is the 19th largest state in area and the 16th largest state in population with 23 districts. Punjab’s official and widely spoken language is Punjabi; it is written in Gurmukhi script, and the major ethnic groups in Punjab are Sikh, Hindu, and Punjabis. The state shares its capital Chandigarh with the neighboring state Haryana.
It is named Punjab because the five tributary rivers (Sutlej, Beas, Ravi, Chenab, and Jhelum) of the Indus River flow in this state. The state has suffered from the dark scars of the holocaust during the partition in 1947. Punjab is the 9th highest-ranking state on the State Human Development Index. The sex ratio of Punjab is constantly declining, as the sex ratio of the state is 895 females per thousand males.
As Punjab has the most fertile land so, the economy of the state is highly dependent on agriculture. Punjab’s soil and climatic conditions are perfect for growing sugarcane, wheat, rice, fruits, and vegetables. Punjab’s economy has always been based on agriculture, but the state’s economy got a boost after the launch of the Green Revolution. The largest cultivated crop in Punjab is wheat, and Ferozepur and Fazilka districts are the largest producers of wheat and rice. Punjab is called the breadbasket of India because it has high wheat production. The state has recorded the lowest level of hunger in India, according to the Indian state hunger index. Besides agriculture, the other sources of economic development in Punjab are tourism, music, and the film industry.
Capital- Chandigarh

The startup ecosystem of Punjab
In the state’s startup ranking 2019 Punjab has been entitled as the aspiring leader. In 2017 the Punjab government officially launched its Industrial and business development policy. The motto of the Policy was to promote industrial development to nurture and grow the startup ecosystem. The 2017 Industrial Business Development policy aims to promote innovation and entrepreneurship spirit in the people of Punjab so that they can shift from job seekers to job creators.
To build a robust startup ecosystem, the state government has promoted networking of prominent academic institutions of higher education that carry out research and innovation along with other organizations operating incubators and accelerators. Following are the main objectives of the industrial and business development policy 2017: –
The policy aims to build a strong startup ecosystem and promote the entrepreneurship spirit in the people of Punjab, especially the young population.
Through the policy, the government of Punjab wants to promote private incubators and accelerators and facilitate funding mechanisms for entrepreneurs to nurture the startups.
The policy is framed to promote incubation centers by the government organization to build a robust startup ecosystem.
The government of Punjab is creating a common infrastructure in all the districts of Punjab. The infrastructure comprises the ready-to-use office spaces, research, and development testing laboratories, software, and hardware solutions; the Punjab government makes all these infrastructure changes to ensure a strong startup ecosystem.
The policy aims to promote sector-specific incubators and set up incubation centers in universities and other academic institutions of higher education.
The state government aims to give special attention to scheduling caste and women entrepreneurship to upgrade their socio-economic status through the policy.

Top business ideas in Punjab
Phulkari business
Phulkari’s work of Punjab is famous all around the world. Phulkari, in its literal sense, means flower work. Phulkari is a handmade embroidery on clothes, and it employs the women of Punjab particularly. By setting up a Phulkari business, you can employ the local women of Punjab, which means that you can find high-quality work with low payment. Phulkari business is a low investment business, and you can export your Phulkari products to the international markets to gain high profits.

Farm equipment lease
Not every farmer in Punjab can afford to have their farming equipment. So, setting up a Farm equipment lease business is a long-term profit-providing idea. To set up a farm equipment lease business, you need a lot of investment to buy modern technology, like tractors, threshers, sprayers, etc. Though this is a high investment business, it will help you make huge profits. You can lease your farming equipment hourly and maximize the return.

Seed store business
Usually, the producer sells the product to the customer, but what if I tell you that you can sell something to the producer. You can establish a seed store in Punjab, selling plant seeds, animal feed, fertilizers, and pesticides to the farmers. You can also link your store with online websites to expand your business. However, setting up a seed store needs considerable investment, but once it is established, it will make huge profits.

Dairy parlor business
Punjab is famous forits dairy products. Many customers love buying fresh milk, curd, and paneer. They prefer purchasing milk-related products from the local milkman rather than pasteurized packets. Especially the people of Punjab are way too health-conscious regarding dairy products. Lassi is the traditional drink of Punjab, and Punjabi people love milk and milk-related products. So, setting up a dairy farm in Punjab can make you earn huge profits. You can also sell your products online by establishing a website. If you don’t have enough milk or milk-related products to sell online, you can tie up with local milkmen to complete the demand.

Organic farming
Punjab has agricultural land where most farmers are engaged in agriculture and farming, mainly organic farming. Organic farming in Punjab is an excellent startup idea as you can directly send your organic vegetables and fruits to the market. The demand for organic vegetables and fruits is on the rise in the market. People nowadays do not mind paying extra money for organic products and food, so if you know about organic farming, setting up an organic grocery store and organic farming business is an excellent startup idea in Punjab. The organic farming startup is a low-investment and high-profit business. One can employ your land and sell theproducts to regional, national, and international markets. The only thing that is crucial and needs to be kept in mind is that one should avoid mediators or agents while selling their organic products as they consume a lot of commission. If you find growing and selling your organic products difficult, you can contact the small-scale farmers and sell organic products in partnership.

Salient Features of a Public Limited Company registered in Chandigarh, Punjab

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 Chandigarh, Punjab

There are several differences between a private & Public Limited Company registered in Chandigarh, Punjab 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 Chandigarh, Punjab

Step 1-Obtain DSC for the proposed Company in Chandigarh, Punjab

As a first step towards registration in Chandigarh, Punjab, 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 Chandigarh, Punjab

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 Chandigarh, Punjab

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 Chandigarh, Punjab

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 Chandigarh, Punjab

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 Chandigarh, Punjab

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 Chandigarh, Punjab

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 Chandigarh, Punjab

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 Chandigarh, Punjab

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 Chandigarh, Punjab

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 Chandigarh, Punjab

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 Chandigarh, Punjab

Therefore, a Public Limited Company registered in Chandigarh, Punjab 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.