Steps in Establishment of Start Up or new Business Entity

STEP 1

• Decide on Entity form – Proprietorship, Partnership firm, Limited Liability Partnership (LLP), Company (Private or Public)
• In case of foreign investment only LLP (Limited Liability Partnership) and Company is allowed

 

STEP 2

• Get PAN for Proprietor, Partners, Shareholders and Directors. For Directors or Partners of LLP get DIN (Director Identification Number) in addition to PAN
• PAN can be obtained by applying online in Income Tax Website or manually filing application with nearest NSDL or UTI office or Income tax Sevakendra
• DIN can be obtained by filing online application in GOI / MCA website

Income Tax website: https://incometaxindiaefiling.gov.in

MCA website: mca.gov.in

NSDL website: https://www.tin-nsdl.com/

UTI website: https://www.utiitsl.com/UTIITSL_SITE/

 

STEP 3

Companies/LLP

• In case of a Company/LLP decide on a Name and apply online for Name Approval with the Jurisdiction’s Register of companies (ROC)
• In case of Private Ltd Company minimum 2 Shareholders and minimum 2 Directors are required. In case of Public Company minimum 7 Shareholders and minimum 3 Directors required. In case of LLP minimum 2 Partners are required.
• Once Name Approval is obtained, within 30 days prepare the Memorandum and Articles of Association and file online with ROC, and get the Company incorporated
• Apply for PAN for the Company/LLP
• Within 6 months thereafter file online for commencement of business.

 

Partnership firm

• Decide the Name and at least 2 Partners who are above 18 years of age
• Prepare and execute Partnership Deed in Non Judicial Stamp Paper of appropriate value
• Get the firm registered with Registrar of Firms and obtain Registration Certificate

Registrar of Firms:

Maharashtra –https://rof.mahaonline.gov.in/

Tamilnadu –http://www.tnreginet.net/english/forms.asp

UP – http://uprfsc.gov.in/

Karnataka –https://www.karnataka.gov.in/karigr/Pages/registration-of-firm.aspx

Bengal –https://wbregistration.gov.in

 

Proprietorship

• Can be carried in name of Proprietor or under a Trade Name

 

STEP 4

• Register with MSME if value of your investment in Plant & Machinery is less than Rs.10 crores.
• If the investment in Plant & Machinery is more than Rs.10 crores obtain IEM (Industrial Entrepreneur Memorandum) from Department of Promotion of Industry & Internal Trade (DPIIT) at www.dipp.gov.in
• File online and obtain IE code from the Directorate General of Foreign (DGFT) at www.dgft.gov.in, in case Imports and/or Exports are contemplated.
• In case of exports being contemplated you can procure capital goods without payment of duties under the Export Promotion Capital Goods (EPCG) License to be obtained from DGFT

MSME udyogadhar –https://online-udyogaadhaar.com

STEP 5

• Open Bank Account
• In case your Sales Turnover is likely to cross Rs.40 lakhs register for GST in GST Portal
• In case you are going to do interstate supplies and exports register for GST, even if turnover is less than Rs.40 lakhs
• If Bank Account not opened before GST Registration, within 45 days or before due date filing the first month GST Returns, open Bank Account and provide in GST Portal

Bank Account opening – should be done in person

Gst Portal- gst.gov.in

 

STEP 6

• In case of construction of factory the local planning approvals and Inspector of Factories approval is required.
• Factory License, local body Licenses may be obtained if applicable
• Pollution Control Clearance to be obtained if applicable
• In case you would have more than 20 employees then register online under Provident Fund .
• In case you would have more than 10 employees then register online under ESI Act.
• Apart from this if there are any local law of a State, Registration as per that Law is required separately

STEP 7

• There are various other approvals required from various State Bodies/Departments as for Power Connection, Generator Installations, Sewage, Boilers, Fire, Weighing, etc, which need to be taken care of prior to business/production commencement.