REGISTERING COMPANIES AUTHORISED TO REGISTER

Part – I of Chapter XXI deals with companies authorizes to register under this Companies Act, 2013.

Any company formed under any law for the time being in force duly constituted according to law and consisting of two or more members may at any time register under this Act as a company. This registration shall not be invalid by reason only that it has taken place with a view to the companies being wound up. We have discussed these provisions of Section 366 of the Companies Act, 2013 as amended and updated earlier here.

The Companies (Authorised to Registered) Rules 2014 supplement the provisions of the Companies Act 2014. Till 5^th July 2018 with effect from 15^th August 2018 these rules had no provision of conversion of society and trust to the company as discussed earlier here.

In this series of posts, we will discuss these rules as amended by the Companies (Authorised to Registered) 2^nd Amendment Rules, 2018.

Applicability of Chapter II

According to Rule 3(1), Provisions of Chapter II – Incorporation of Company and matters incidental thereto, shall apply mutatis mutandis to the companies registered under Part I of Chapter XXI – Company authorized to register.

General Conditions for applicability

There shall be two or more members for the purposes of registration of a company under this sub-rule (1) of Rule 3. A company with less than seven members shall register as a private company. [Rule 3(1)]

A company shall attach and provide the required documents and information to the Registrar along with Form URC – 1. [Rule 3(2)]

An undertaking from all the members or partners or trustees providing that in the event of registration as a company under Part I of Chapter XXI of the Act, necessary documents or papers shall be submitted to the registering or other authority with which the company was earlier registered, for its dissolution. No such undertaking shall be required to be submitted in case the application for registration under Part I of Chapter XXI of the Act has been made by a Limited Liability Partnership registered under the Limited Liability Partnership Act, 2008 (6 of 2009). [Rule (4)]

Application by a Limited Liability Partnership or firm for registration as a company limited by shares

The application URC – 1 by a limited liability partnership or a firm for registration as a company limited by shares shall attach following documents:

• A list of members who on a day, not being more than six clear days before the day of seeking registration, were partners of the Limited Liability Partnership or firm as the case may be, showing:
  1. the names;
  2. addresses;
  3. occupations of all persons named therein as partners;
  4. details of the shares held by them respectively;
  5. showing separately shares allotted for consideration in cash and for consideration other than cash along with the source of consideration; and
  6. distinguishing in cases where the shares are numbered, each share by its number.
• a list showing persons proposed as the first directors of the company, along with
  1. Director Identification Number (DIN);
  2. passport number, if any, with the expiry date;
  3. residential addresses;
  4. their interests in other firm or body corporate; and
  5. their consent to act as directors of the company.
• in case of a firm,
  1. deed of the partnership;
  2. bye-laws or other instrument constituting or regulating the firm;
  3. in case the deed of partnership was revised at any time in the past, copies of the principal and all subsequent deeds including the latest deed; and
  4. the certificate of the registration issued by the Registrar of Firms, in case the firm is registered;
• the written consent or No Objection Certificate from all the secured creditors of the applicant;
• written consent, from the majority of members whether present in person or by proxy at a general meeting, agreeing for such registration;
• an undertaking that the proposed directors shall comply with the requirements of the Indian Stamp Act, 1899 (2 of 1899) as applicable;
• a copy of the latest income tax return of the Limited Liability Partnership or firm, as the case may be.

Application by a Limited Liability Partnership or firm for registration as a company limited by Guarantee or Unlimited company

The application URC – 1 by a limited liability partnership or a firm for registration as a company limited by shares shall attach following documents:

• A list of members who on a day, not being more than six clear days before the day of seeking registration, were partners of the Limited Liability Partnership or firm as the case may be, showing:
  1. the names;
  2. addresses;
  3. occupations of all persons named therein as partners; and
  4. proof of membership.
• a list showing persons proposed as the first directors of the company, along with
  1. Director Identification Number (DIN);
  2. passport number, if any, with the expiry date;
  3. residential addresses;
  4. their interests in other firm or body corporate; and
  5. their consent to act as directors of the company.
• in case of a firm,
  1. deed of the partnership;
  2. bye-laws or other instrument constituting or regulating the firm;
  3. in case the deed of partnership was revised at any time in the past, copies of the principal and all subsequent deeds including the latest deed, and
  4. along with the certificate of the registration issued by the Registrar of Firms, in case the firm is registered;
• in the case of a company intended to be registered as a company limited by guarantee, a copy of the resolution declaring the amount of guarantee;
• the written consent or No Objection Certificate from all the secured creditors of the applicant;
• the written consent, from the majority of members whether present in person or by proxy at a general meeting, agreeing for such registration;
• an undertaking that the proposed directors shall comply with the requirements of the Indian Stamp Act, 1899 (2 of 1899) as applicable;
• a copy of the latest income tax return of the Limited Liability Partnership or firm, as the case may be.

Application by a society for registration as a company limited by guarantee under section 8

The application URC – 1 by a society for registration as a company limited by guarantee under section 8 shall attach following documents:

• a list of members who on a day, not being more than six clear days before the day of seeking registration, were members of the society, showing
  1. the names;
  2. addresses;
  3. occupations; and
  4. a proof of membership.
• a list showing persons proposed as the first directors of the company, along with:
  1. DIN,
  2. passport number, if any, with the expiry date,
  3. residential addresses
  4. their interests in other firms or bodies corporate; and
  5. their consent to act as directors of the company;
• a list containing the names and addresses of the members of the governing body of the society;
• a certified copy of the certificate of registration of the society;
• the written consent or No Objection Certificate from all the secured creditors of the applicant;
• written consent from the majority of members whether present in person or by proxy at a general meeting agreeing for such registration, and the resolution shall also provide for declaration of the amount of guarantee;
• an undertaking that the proposed directors shall comply with the requirements of the Indian Stamp Act, 1899 (2 of1899) as applicable;
• a copy of the latest income tax return of the society;
• details of the objects of the company along with a declaration from all the members that the restrictions and prohibitions as mentioned in clause (b) and clause (c) of sub-section (1) of section 8 of the Act shall be compiled.

Application by a trust for registration as a company limited by guarantee under section 8

The application URC – 1 by a trust for registration as a company limited by guarantee under section 8 shall attach following documents:

• a list of members who on a day, not being more than six clear days before the day of seeking registration, were trustees of the trust, showing
  1. the names;
  2. addresses;
  3. occupations; and
  4. a proof showing them as trustee.
• a list showing persons proposed as the first directors of the company, along with:
  1. DIN,
  2. passport number, if any, with the expiry date,
  3. residential addresses
  4. their interests in other firms or bodies corporate; and
  5. their consent to act as directors of the company;
• a certified copy of the certificate of registration of the trust and the trust deed;
• the written consent or No Objection Certificate from all the secured creditors of the applicant;
• written consent from the majority of members whether present in person or by proxy at a general meeting agreeing for such registration, and the resolution shall also provide for declaration of the amount of guarantee;
• an undertaking that the proposed directors shall comply with the requirements of the Indian Stamp Act, 1899 (2 of 1899) as applicable;
• a copy of the latest income tax return of the trust;
• details of the objects of the company along with a declaration from all the members that the restrictions and prohibitions as mentioned in clause (b) and clause (c) of sub-section (1) of section 8 of the Act shall be compiled.

Certificate of Registration

Where an application is made by a society or trust for registration as a company limited by guarantee under Section 8, the Registrar shall issue a license in Form INC – 16 to allow such society or trust to be registered as a limited company without the addition to its name of the word “Limited”, or as the case may be, the words “Private Limited”.

The condition for the license shall be issued where:

1. it has been proved to the satisfaction of the Registrar that the proposed company has its objects in accordance with clause (a) of subsection (1) of section 8 of the Act;
2. it intends to comply with the restrictions and prohibitions as mentioned respectively in clause (b) and clause (c) of that sub-section

Thereupon, the registrar shall issue a certificate of incorporation in terms of sub-rule (4) of rule 4 on an application submitted under Chapter II of the Act for incorporation of a company.

Ineligibility of societies for registration under section 366

A society which has not filed the annual or other returns, statutorily required to be filed with the Registrar of Societies, shall not be eligible to apply for registration under section 366 of the Act.

Dissolution of original organization

An undertaking from all the members or partners or trustees providing that in the event of registration as a company under Part I of Chapter XXI of the Act, necessary documents or papers shall be submitted to the registering or other authority with which the company was earlier registered, for its dissolution. No such undertaking shall be required to be submitted in case the application for registration under Part I of Chapter XXI of the Act has been made by a Limited Liability Partnership registered under the Limited Liability Partnership Act, 2008 (6 of 2009). [Rule (4)]

Verification

The list of members and directors and any other particulars relating to the company which are required to be delivered to the Registrar shall be duly verified by the declaration of any two or more proposed directors.