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“Nidhi” or “Mutual Benefit Society” means a company-

• Incorporated as a Nidhi in accordance with Section 406 of the Companies Act, 2013 and Nidhi Rules, 2014.
• Complies with Rules prescribed by Central Government
• Object: Cultivate the habit of thrift and savings amongst its members for their mutual benefit.
• Receive deposits from members and Lend only to members.

Incorporation and Incidental matters-

• Public Company
• minimum paid up equity share capital of five lakh rupees or more
• Equity Shares Only
• Part of name ‘Nidhi Limited’

Requirements and fulfillment of following conditions:

• not less than two hundred members
• Net Owned Funds of ten lakh rupees or more
• unencumbered term deposits of not less than ten per cent. of the outstanding deposits
• ratio of Net Owned Funds to deposits of not more than 1:20
• Not to be admitted as a member- Body Corporate, Trust and Minor.

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The term ‘one person company’ has been defined under Section 2(62) of Companies Act, 2013.

As per this, One Person Company’ means a company which has only one person as a member.

The OPC are becoming popular for doing business/profession/service in various economic fields in India by entrepreneurs, professionals, business persons, industrialists, etc.

It is basically a private company with some unique features.

The concept of OPC provides a more flexible structure and less compliance requirements of a company.

An OPC can be formed and managed by a single director and a single shareholder and a single person can be both of these simultaneously.

The subscriber to the memorandum of a OPC shall nominate a person, after obtaining prior written consent of such person, who shall, in the event of the subscribers death or his incapacity to contract, become the member of that OPC.

It may be noted that only a natural person who is an Indian Citizen and Resident in India-

• Shall be eligible to incorporate a OPC;
• Shall be a nominee for the sole member of a OPC.

The professionals of AUDITING BAZAAR  provide efficiently and responsibly all support and services for OPC registration in India, and also for conversion of OPC into private or public limited company, as per requirement.

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A Partnership firm is an entity created by persons who have agreed to share profits or loss of the business. Partnership is an association of two or more persons to carry on a business in the capacity of co-owners. Each such person is called a partner. All the partners share the profits and losses in proportion of their respective ownership, or as agreed between them. Partnerships are very easy to manage to start small enterprises wherein two or more persons decides to contribute to a business and share the profits or losses. In India, Partnerships are widely popular because of its ease of formation and minimal regulatory compliance. Also, the concept of LLP was introduced only in 2010, whereas the Partnership Act, 1932 has been in existence before the independence of India. Thus, partnership firms are the most prevalent type of business entity.

Section 4 of The Partnership Act, 1932 defines partnership as “the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all.”

Since a proprietary form of business is faced with many limitations mainly the amount of money that can be invested by a businessman in a business and the limitations in strategic decisions, Partnership Firms are formed to remove these limitations and allows the growth of business.

It is advisable to get a Partnership Firm registered to ensure that the firm gets a legal proof of its existence though it is not mandatory.

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A foreign subsidiary company is any company, where 50% or more of its equity shares are owned by a company that is incorporated in another foreign nation. The said foreign company in such a case is called the holding company or the parent company.

For a company to be a foreign subsidiary company in India, the company itself must be incorporated in India. It does not matter which country the parent company is incorporated in.

Compliances are based on many aspects of the company. One must understand what all compliances are supposed to be met according to the type of company that is incorporated, the industry of operations, annual turnover, number of employees. A foreign company is defined under section 2(42) of the Companies Act, 2013, such a company must follow regulations and rules established under multiple legislations and orders such as:

– Companies Act, 2013

– Income Tax Act, 1961

– GST, 2017

– SEBI rules and regulations

– FEMA (Foreign Exchange Management Act), 1999

– RBI compliances etc.

At AUDITING BAZAAR, we offer services to corporates looking to set up a Foreign subsidiary in India by ensuring end to end compliances of all applicable laws and regulations.

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Non-profit companies  are registered under Section 8 of Companies Act, 2013

An association not for profit must satisfy the following conditions:

• It is formed for promoting commerce, science, art, religion, charity, sports, education, research, social welfare, protection of environment or other useful objects; and
• It does not intend to pay any dividend to its members but apply its profit or other income in the promotion of its object.

A company which has been granted license under Section 8 cannot alter any of the provisions of its memorandum as well as the articles of association except with the previous approval of the Central Government.

It may be noted that a Section 8  company shall amalgamate, only with another company registered under Section 8 and having similar objects.

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A Public Company under Section 2(71) of Companies Act, 2013 means a company which has such minimum paid-up share capital as may be prescribed and which is not a private company.

A Public limited company is entitled to gather massive capital from public investors and depositors and can transfer its shares, list its shares in the stock market and since these companies access public funds, there is relatively more statutory control as the public interest in these companies is maximum.

There should be at least 7 persons to form a public company i.e., the minimum number of members is seven and shall have at least 3 directors.

The name of a public limited company must end with the words “Limited”.

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The points to be kept in mind while forming a society are:

1. A minimum of seven persons are required for formation of a society
2. They must be associated for any Literary, Scientific, or Charitable purpose and shall subscribe their names to a Memorandum of Association and filing the same with the Registrar of Societies , form themselves into a Society under the Societies Registration Act, 1860.
3. The proposed name must be in accordance with The Emblems Act, 1950
4. MOA shall contain the Objectives, Details of members and the address of the registered office of the society.
5. AOA shall contain the rules and regulations regarding the day to day workings of the society, frequency of meetings, Information about the Auditors, forms of arbitration in case of any dispute between the members of the society and ways for the dissolution of the society .
6. A declaration has to be given by the president of the proposed society that he is willing and competent to hold the said post.

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