basics information on formation of company ....

1. FORMATION OF A COMPANY
PRESENTED BY:
ADITYA JHA

2. CONTENTS
MEANING OF FORMATION OF COMPANY
STAGES IN FORMATION
A. PROMOTION
B. INCORPORATION
C. CAPITAL SUBSCRIPTION/FLOTATION
D. COMMENCEMENT OF BUSINESS

3. What do you mean by formation of a
company?
A Company comes into existence when
a group of people come together with a
view of forming an association to grab
the business opportunities by bringing
together; men, material, money and
management.

6. Promotion stage includes
 Discovery of Business opportunities.
 Detailed Investigation.
 Assembling necessary requirements.
 Financing of proposition.

7. 2.INCORPORATION

8. INCORPORATION STAGE
A company is said to be incorporated when it fulfill the formalities of registration and obtain
“CERTIFICATE OF INCORPORATION” by submitting the MoA, AoA and written consent of all the
directors.
The second stage for establishment of a company is to get the company incorporated or registered.
The promoters have to prepare and file a number of documents with the registrar.
1. The memorandum of association signed by at least seven persons
2. The articles of association signed by at least seven persons
3. Promoters have to file a prospectus or statement in lieu of prospectus with the registrar.
4. A list of directors and their willingness to act, duly signed by each of them.
5. Notice of address at which the registered office of the company will be situated
6. All the director whose names are in the list have to submit a declaration certificate that they
have taken up qualifying shares and have paid up the money.

9. SELECTING COMPANY
NAME
To be identified for
legal and business purpose
(i.e. “Ltd” or “Pvt Ltd” ). The
name should not be similar to
the existing.

10. Example for :
CERTIFICATE OF INCORPORTATION
of VISWASGOLD INFRASTRUCTURES

11. 3.FLOTATION/CAPITAL
SUBSCRIPTION

12.  SEBI Approval
 Entering onto an agreement with
underwriters.
 Applying to the stock exchange for
listing of shares.
 Issue of prospectus inviting public to
subscribe.
 Allotting shares.
RAISING OF SHARE CAPITAL

14. Commencement of business
A public company, issuing prospectus will have to file some docs, with registrar to secure
commencement of business.
Docs: Shares payable in cash have been allotted
Every director has paid cash for the allotment
No money is liable to become refundable
 A public to commence business, should raise the required capital and obtain the
 “CERTIFICATE OF COMMENCEMENT OF BUSINESS”

15. Example for :
CERTIFICATE OF
COMMENCEMENT OF
BUSINESS of VISWASGOLD
INFRASTRUCTURES