Starting a Business in Jaipur, India

To check whether the name is acceptable or available, the entrepreneur can use the website of the Ministry of Company Affairs (“MCA”) – www.mca.gov.in.
For any clarification or doubt the office of the Registrar of Companies (‘ROC’) can be visited.

Address: 132, Vijay Nagar, Kartarpura, Near Kartarpura Railway Crossing, Jaipur 302 006
Phone: 0141-500564/500565
Fax: 0141-500564
After the name has been finalized, six names in order of preference can be inserted in the prescribed Form 1-A for making the application to the agency notified by the MCA (MCA PFO, A/5-A, ICSI House, Insitutional Area, Jhalana Doongri, Jaipur- 302004) for seeking availability of desired name. The said Form 1A is thereafter forwarded to the office of RoC for further processing.

While filing Form 1A it should be ensured that:

• The details are filled in correctly as no change is entertained in the Form once the Form is filed.
• Guideline Instructions issued by the Department of Company Affairs for deciding the availability of name for the formation of a Company are compiled with.
• As per the provisions of the Emblems and Names (Prevention of Improper Use) Act, 1950, use of improper names is prohibited.

The status of application filed can be ascertained from the MCA’s website.

The Ministry of Company Affairs has laid down guidelines as regards the use of key words in a company’s name. In order to have a key word as part of the company’s name, the following minimum authorized share capital requirements have to be fulfilled: -

NR 500 (for MOA) + 0.5% of capital (for AOA) + INR 10 (stamp paper for declaration in Form 1))

Memorandum and Articles of Association is drafted on plain paper and then presented to the Officer of Stamps for stamping. Special adhesive stamps are affixed on the MOA and AOA.

The application should be accompanied necessarily by the following:

(i) Two Blank Copies of the Memorandum of Association and Articles of Association.

(ii) Payment receipt.

Ensure that the copies submitted to the Superintendent of Stamps for stamping are unsigned and no promoter or subscriber has written anything on it by hand. The Superintendent returns the copies one of which is duly stamped, signed and engrossed evidencing the payment of the requisite stamp duty.

The print out of the Memorandum and Articles of Association of the Company on the non judicial stamp paper are to be signed by at least two subscribers, each of whom shall also write in his own hand, his fathers name, occupation, address and the number of shares subscribed for. There will at least be one witness to these signatures, who shall also sign and write in his own hand, his fathers name, occupation and address. Get the following documents prepared:

• Form 1 (Declaration of Compliance) - This is to be given by an advocate of the Supreme Court or of a High Court or a Secretary or a Chartered Accountant, in whole time practice in India who is engaged in the formation of a Company or by a person named in the Articles of the company as a director, manager, or secretary of the company that all the requirements of the Companies Act, 1956. This declaration should be on the non judicial stamp paper Rs. 10/- of the appropriate value with reference to the State in which the office of the Registrar of Companies situate.
• From- 18 (Notice of situation of the registered office)-This form is to be signed by the First Director of the Company named in the Articles and must be lodged with the Registrar together with the Memorandum and Articles of Association at the time of lodgment for the incorporation of the proposed company
• Form 32 (in duplicate) (Particulars of Directors )
• Power of Attorney (on Non-judicial stamp paper Rs. 100/- ) to be given in favor of one of the promoter/subscriber or chartered accountant or company secretary or an advocate for fulfilling various formalities at Registrars' office for incorporation of a company.

The fees paid to the Registrar for registration are scaled according to the amount of the share capital of a company as stated in its memorandum. The schedule is as following:

For registration of a company whose nominal share capital does not exceed Rs.100,000: Rs. 4,000.

For registration of a company whose nominal share capital exceeds Rs.100,000, the above fee of Rs.4,000 with the following additional fees regulated according to the amount of nominal capital:-

(a) Rs. 300 for every Rs.10,000 of nominal share capital or part of Rs.10,000 after the first Rs.1,00,000 up to Rs.5,00,000;

(b) Rs. 200 for every Rs.10,000 of nominal share capital or part of Rs.10,000 after the first Rs.5,00,000 up to Rs.50,00,000;

(c) Rs. 100 for every Rs.10,000 of nominal share capital or part of Rs.10,000 after the first Rs.50,00,000 up to Rs.1 crore;

(d) Rs. 50 for every Rs.10,000 of nominal share capital or part of Rs.10,000 after the first Rs.1 crore.

The above stated fees are required to be paid in the office of the ROC by way of a Demand Draft/ Treasury Challan.

The DD has to be drawn in favor of either the office of the concerned ROC or in favor of the Pay and Accounts Officer, Department of Company Affairs.

Schedule of RoC filing fees for the Articles and for the other forms l, 18 and 32:

• Rs. 200 In respect of a company having a nominal share capital of Rs. 100,000 or more but less than Rs. 500,000;
• Rs. 300 In respect of a company having a nominal share capital of Rs. 500,000 or more but less than Rs. 2,500,000;
• Rs. 500 In respect of a company having a nominal share capital of Rs. 2,500,000 or more.

The ROC will then scrutinize the documents filed by the Company and if necessary the authorized person will on intimation make the necessary corrections under his initials. Obtain the Certificate of Incorporation of the company from the office of the ROC. The company can commence its business on getting incorporation certificate from RoC. The other procedures given below can be done after the business is started.

 Although the process of electronic filing has begun to take place, as of April 2006, the person incorporating has two choices. He or she can either file the company documents in the traditional manner, or can prepare a soft copy of all forms (which are now available online), save them in a floppy or CD, and take it to the registry where it is uploaded to the new system and filed. Once the electronic system is fully implemented, the goal is that an entrepreneur will be able to incorporate the company from any computer. All documents for company incorporation will be available for electronic filing subject to the condition that the person has obtained a Digital Signature Certificate. To obtain a Digital Signature Certificate an application is required to be submitted with the agencies, which are notified by the MCA.

Another new requirement is the Directors Identification Number (DIN); which will be mandatory for every person who is a director on the board of the company. Directors can receive a provisional DIN through the Web. The provisional number is used in the same way as the final number, which will be issued in about 30 days. A person can only have one DIN and it is used for all companies for which he or she is a director

The Company is required to apply for allotment of the Permanent Account Number (PAN) by making an application in Form 49A on or before 31st May of the relevant assessment year and filing with the UTI Investor Services Limited, Anand Bhawan, 3 rd Floor, Sansar Chandra Road, Jaipur. Documents required will be certificate of Registration issued by the Registrar of Companies.

The task of allotment of Permanent Account Number has been assigned by the Ministry of Finance, Government of India to the Unit Trust of India ("UTI"). The offices of Unit Trust of India are situated in all the major cities of India. The Form is available at all the designated offices of UTI. The Permanent Account Number is generally allotted within a period of 15-30 days from the date of filing the application.

The work of allotment of PAN is also assigned to National Securities Depositories Limited (“NSDL”). So the application can also be made with any one of the designated Tax Information Network (TIN) Facilitation Centres. Related link is www.incometaxindia.gov.in.

The application for TAN is required to be filed at Karvy Consultancy (Anukampa II, opposite Raymond Showroom, MI Road, Jaipur) . Application is to be accompanied with the copy of Memorandum and Articles of Association of the Company, list of Directors and board’s resolution in favor of any director authorizing him to apply for the TAN. TAN must be applied immediately after first deduction of tax at source.

In Jaipur, sales tax registration under the Rajasthan Sales Tax Act 1994 as well as the Central Sales tax Act, 1957 is required to be done at the office of the Assistant Commissioner, Jaled Chowk, Near City Palace, Jaipur.

Application for registration under Rajasthan Sales Tax is to be filed in Form no. ST-3. The documents required to be filed are:

-The Memorandum and Articles of Association of the Company;

-Copy of the Board Resolution;-An affidavit on Rs.10/- stamp paper

-Security Bond in form no.ST-32 of Rs. 200 signed by two guarantors

-Two photographs of any one director,

-Rent receipt

Under the Rajasthan Sales Tax Act, the following points may be noted:

-If turnover exceeds Rs. 50,000/- in case of importer or manufacturer & Rs.100,000 in other cases, dealer is required to get obligatory registration.,

-If a dealer is dealing exclusively in tax paid goods, registration is required if turnover exceed Rs.15.00 lacs.

-A manufacturer can get provisional registration for a period of 6 months before he starts commercial production;

-A dealer registered under the Central Sales Tax Act, 1956 will compulsorily be required to get registered under Rajasthan Sales Tax. Application to the for registration under Central Sales Tax is made to the Competent Authority in Form A along with a security bond of Rs.10,000/- to be executed on a stamp paper of Rs.200/- along with SR.25/- registration fee in the form of court fees. The application is to be made within 30 days of the Company becoming liable to pay tax.

Since PAN has to be furnished to sales tax authority at the time of final scrutiny (normally about 10 days after the date of making the application, by which time PAN may also be obtained), the process can be simultaneous to Procedure 8. Consultancies and professional companies do not require Sales Tax Registration. Sales tax registration will be effective from the date of application.

An application for registration under The Employees' Provident Fund and Miscellaneous Provisions Act, 1952 may be done at the office of the Regional Provident Fund Commissioner at Nidhi Bhawan, Vidyut Marg, Jyoti Nagar, Jaipur – 302 005.

The Act provides for the institution of compulsory Provident Fund, Pension Fund and Deposit Linked Insurance Fund, for the benefit of the employees in factories and other establishments. The Act applies to every factory and establishment in which 20 or more persons are employed and which is engaged in any industry as specified. The company would be required to cover its employees under the provisions, once it crosses the limit of 20 employees.

For registration under the said Act the following documents may be required:

• a copy of Memorandum and Articles of Association of the Company
• Certificate of Incorporation of the Company-lease deed (if any);
• a copy of documents in support of ownership of the factory premises.
• copy of PAN
• Board Resolution-Details of the activities of company
• formal request to register the company.

In Jaipur, registration under the abovementioned Act is required to be made at the office of the Regional Director, Employees State Insurance, Panchdeep Bhawan, Bhawani Singh Road, Jaipur in Form no. 01. The application for registration is to be made within 15 days of the Act becoming applicable on the Company.

The Act provides for grant of cash benefits to the employees in the recognized contingencies of sickness, maternity and employment injury. It also provides for medical benefit, in kind, to the employees and their families. The Act is applicable to all non-seasonal factories and certain establishment. For registration under the Act, an application in the prescribed Form is required to be made to Regional Office of Employee State Insurance Corporation.

ESIC Registration is optional if employee strength is less than 10 in a factory carrying on manufacturing process with the aid of power and less than 20 where the manufacturing process is being carried on without the aid of power.

The Procedure for obtaining registration certificate under the Rajasthan Shops and Commercial Establishments Act, 1958 is as follows:

The employer of every establishment shall, within thirty days from the date of commencement of its work, submit with the concerned authority, i.e. Joint Commissioner, Labour Department, opposite NEI Ltd., Hasanpura, Jaipur, a statement in the prescribed form along with the applicable fee (depending on number of workers working in the establishment) for registration of the establishment.

The statement shall consist of the following information:

• the name of the employer and the manager, if any;
• the postal address of the establishment; and
• such other particulars as may be prescribed.

Some documents that may be filed for the Shops and Establishment Registration is:

-proof of opening of the establishment

-List of number of workers

The fees payable depends on the number of employees. For around 21-50 workers the cost will be around Rs.625 per year or a one time fee of Rs. 6250 may be paid.