Private Limited

Evidently, this is the most common form of company incorporation. Governed by the Companies Act, 2013, it requires a minimum of 2 Directors and 2 Shareholders, with one of the Directors being an Indian Resident and Indian Citizen. This business entity limits owner liability to their shareholdings and the number of shareholders to 200 and restricts shareholders from publicly trading shares. Example- Flipkart, Ola and so on.

Benefits

Limited Liability
As a shareholder, you will be liable to pay for the company’s liability only to the extent of your contribution. The shareholders do not have any personal liability and hence need not pay for the company’s liability out of their assets.
Separate Legal Entity
A private limited company becomes a separate legal entity after being incorporated. The company is responsible for managing its assets and liabilities, debtors, and creditors.
Perpetual Succession
A most distinct advantage of such a company is perpetual succession. A company, being a separate legal entity, is unaffected by the death or cessation of any member but continues to exist irrespective of the changes in membership.
Funding & Foreign Investment
Attracting funds is relatively easy for Private limited companies as one can raise through equity and debt funds, thus, setting up an optimal capital structure. For companies looking for investment abroad can also receive direct foreign investment.

Limitations

Tedious Registration & Dissolution process
Registering a private limited company involves a tedious process and costs which do not apply to an unregistered entity like a proprietorship. The procedure for dissolving the company can be equally complicated, time-consuming, and costly. A lot of documentation is required and often needs a qualified CA to smoothen the process.
More compliance requirements
A company must maintain various compliances irrespective of business turnover or activity. Hence, operating a company involves a minimum recurring cost each year and might face penalties for failing to fulfill these requirements.
Slower Management & More Dependencies
Since it requires a minimum of two persons to act as Directors and shareholders, this type of organization often divides the ownership among designated members. The process of approvals and management can be slow due to dependency on all the participating members.

Documents Required

Documents from Directors like PAN Card, Identity proofs, Address proofs, photographs, etc.
Memorandum of Association
Articles of Association
Proof of the Registered office of the proposed Company, proof of ownership, and a NOC from the owner.
Declaration and Consent of the proposed Director
Copy utility bills such as electricity, water, or gas bills.

Incorporation Process

The MCA has introduced Form SPICe+ - which stands for Simplified Proforma for Incorporating Company electronically Plus. SPICe+ is an integrated Web form offering multiple Government related services. This web-based form has two parts: Part-A and Part-B.

1. Obtain a Digital Signature Certificate (DSC)

A DSC is a digital method of verifying or attesting a document.
A class 2 or class 3 DSC can be obtained through any Government Certifying Agencies (CAs).
You can directly approach CAs for an Aadhar e-KYC-based verification or through the help of supporting documents like PAN, proof of Identity, address proof,etc.
The DSC is often issued with one year or two year validity. DSC is mandatory for all witnesses in the Memorandum of Association (MOA) and Articles of Association (AOA).
This link has details on all certifying agencies authorized to issue DSCs.

2. Obtain a Director Identity Number (DIN)

A DIN serves as a director's identification number.
There are two ways to obtain a DIN -
i. One can either file the eform DIR 3 to get a DIN allotment, or
ii. Apply for DIN through the SPICe+ form. A maximum of three directors can apply for DIN via the SPICe+ form.
c. One DIN is sufficient to serve as a director in any number of businesses.
d. Note: SPICe+ form is used to register your company. More information on the SPICe+ form is provided in the following steps. For additional information on obtaining DIN you can visit the link provided here.

3. Name Approval

Part A of the SPICe+ form provides for 'Name Reservation' with two proposed names and one re-submission (RSUB).
The applicant must re-file another SPICe+ form with the specified fee if the name is rejected due to a name resemblance with a registered company, an LLP, or a trademark or due to non-compliance with the Companies (Incorporation Rules) 2014.
Note: One can simultaneously apply for name approval (Part A) and Incorporation (Part B) through SPICe+. But in cases where both the parts are simultaneously filed, only one name can be reserved.

4. Company Registration

Following name approval, to finish the registration process Part B of the SPICe+ form needs to be submitted.
Part B helps complete the following steps:
i. Application for allotment of DIN (Director Identification Number)
ii. Reservation of company name
iii. Incorporation of a new company
iv. Submission of e-MoA(INC-33) and e-AoA (INC-34)
v. Application for PAN and TAN (mandatory)
vi. Application for EPFO registration (mandatory)
vii. Application for ESIC registration (mandatory)
viii. Application for Professional tax registration (only for Maharashtra)
ix. Application for opening a bank account for the company (required)
x. Allotment of GSTN (Goods and Service Tax registration number) if applied for (optional)
c. The information entered in SPICe+ Parts A and B is immediately transferred to the associated forms AGILE-PRO, eAoA, eMoA, URC1, and INC-9 (as applicable).

5. Follow on steps

After filling out the SPICe+ form, the user must also download the SPICe+ form in PDF format and attach the DSC to the form to digitally sign it.
After the SPICe+ Form has been approved, the Certificate of Incorporation, with a Corporate Identity Number (CIN), is issued along with the PAN assigned by the Income Tax Department. The MCA sends an email with the Certificate of Incorporation, PAN, and TAN.
A bank account is then needed to be opened, which can be done through the AGILE-PRO-S linked web form.

It takes approximately 7 to 10 days from the submission of the SPICe+ form to the grant of the Certificate of Incorporation, provided that the documents submitted are in the format and order required by the relevant authorities.

Post-Incorporation Compliances

All incorporated businesses must comply with the applicable provisions before they begin the business. As a result, it is critical for anyone forming a business to be informed of the company's post-incorporation compliance needs.

Board Meetings
The First Meeting of the Board of Directors must be held within 30 days of the Incorporation of the Company. In a financial year, at least four board meetings must be held, with no more than 120 days gap between such meetings. A penalty fee may be imposed if this is not done.
Auditor appointment
Within 30 days of incorporation, the Board of Directors shall appoint the company's first auditor, who will serve until the end of the first Annual General Meeting.
Annual General Meeting
Every year, on or before September 30th, during business hours and in the registered office or the city where the registered office is located, every company must hold an Annual General Meeting. If the company fails to conduct a meeting, the penalties could be up to one lakh rupees.
Filling of ADT-1 Form
In the first AGM of the company, the BOD shall appoint the subsequent auditor, who shall hold office until the sixth AGM's conclusion and notify the ROC by submitting ADT-1. It is the company's responsibility to file Form ADT 1 within 15 days of the appointment. If the company fails to comply with this provision, it will be fined not less than twenty-five thousand rupees but may extend up to five lakh rupees.
Filing of Annual Return
Annual Return must be filed within 30 days of holding of the Annual General Meeting.
Filing of Financial Statements
Within 30 days of the Annual General Meeting, every Private Limited Company must file its Balance Sheet, Statement of Profit and Loss Account, and Director Report in the form.
Current Account
A current account in any recognised bank for business transactions.
Declaration of commencement of business
The Company has to file a Declaration of Commencement of business with the Registrar of Companies along with a subscription amount as agreed on MoA.

Closure of Private Limited Company

Following steps can be taken to ensure a smooth dissolution of the Private limited company without hampering the future of any viable business by the specific owner.

Hold a Board Meeting to deliberate on the decision for voluntary strike-off u/s 248(2).
Pay off all the liabilities and debts before holding an Extraordinary General Meeting.
Convene EGM for passing a special resolution.
File the specified Resolution in MGT-14 within 30 days
File STK-2 form along with the following documents:

Indemnity Bond duly notarized by every director in Form STK 3; A statement of accounts in form STK-8 containing assets and liabilities of the company made up for a day, not more than 30 days before the date of application and certified by a Professional.
An affidavit in Form STK 4 by every director of the company
CTC of Special Resolution duly signed by each Director
A statement concerning any pending litigations involving the Company

6. After receiving an application, a public notice shall be published by the Registrar of Companies, STK-6, to seek objection from the public to the proposed dissolution.
7. The notice must be posted on the Ministry of Corporate Affairs website, published in the Official Gazette, and published in at least one vernacular daily in the area where the company's registered office is located.
8. The concerned regulatory authorities regulating the company, including the CBDT and CBEC with jurisdiction over the company, would be notified by the ROC simultaneously.
9. After completing all of the steps, the ROC will strike the company's name and dissolve it by publishing a notice in the official gazette in form STK-7.