The most common form of business entity for foreign investors is Private Limited Company. Steps for Forming a Private Limited Company in India are described in the table below.
Once a company is incorporated, there are Other Steps required before a starting a Business in India, includes post incorporation steps required to establish a business in India, which are also described in the table below.
The following table described both the phases for setting up a typical business in India:
| Nature of Procedure in India | Procedure Number | Duration (days) |
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STEPS FOR COMPANY FORMATION IN INDIA |
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| Obtain Director Identification Number DIN for proposed Directors of the new Company | 1 | 1* |
| Obtaiinf Digtal Signature Certificate DSC for proposed Directors of the Company | 2 | 2* |
| Filing the proposed name of company for approval to the Registrar of Companies (ROC) | 3 | 2 |
| Get the Memorandum of Asociation and Articles of Association printed | 4 | 1 |
| Pay stamp duties online | 5 | 1 |
| File all incorporation forms and documents online, including the Memorandum of Association and the Articles of Association. | 6 | 2 |
| Obtain the certificate of incorporation | 7 | 2 |
| Request and obtain Certificate to Commence Operation, if required | 8 | 5 |
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OTHER STEPS FOR SETTING UP BUSINESS IN INDIA |
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| Obtain a company seal | 9 | 3 |
| Obtain a Permanent Account Number (PAN) from an authorized franchise or agent appointed by National Securities Depository Services Limited (NSDL) or Unit Trust of India (UTI) | 10 | 7* |
| Obtain a Tax Account Number (TAN) for income taxes deducted at source from the Assessing Office in the Income Tax Department | 11 | 7* |
| Register under Shops and Establishment Act | 12 | 4* |
| Register for value added tax (VAT) before the Sales Tax Officer of the ward in which the company is located | 13 | 12* |
| Register for Profession tax | 14 | 2* |
| Register with Employees' Provident Fund Organization | 15 | 12* |
| Register with ESIC (medical insurance) | 16 | 9* |
| Filing for Government Approval before RBI/FIPB for Foreigners and NRI's | 17 | 15* |
| Totals: | 17 | 40 |
Note: Procedures sometimes take place simultaneously. Instances of this are marked with an asterisk (*). The above procedures and timings are indicative for a typical big city in India where all the required documents are ready with the promoters. The actual time and procedure may vary with city and state and the nature of business.
All the procedures must be followed.
Foreign Investors Establishing Business in IndiaForeign investors planning to incorporate in India are required to seek governmental approval before investing in India. Some approvals are automatic, - RBI Approvals - though application is required for those approvals. Special Permission - FIPB Approvals - could be obtained to invest over and above the regular percentage allowed. |
Services Offered by UsMadaan & Co. has helped foreign companies, including USA Companies, in setting up their operations in India. A careful tax planning is required before opening a subsidiary, branch, joint venture, project office or liaison office in India. Click here to Contact us for setting up company in India |
Contact us for:
- Incorporating in a company in India
- Opening a Branch Office
- Opening a Project Office
- Setting up Joint Ventures in India
- Setting up a subsidiary in India
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