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The Ministry of Corporate Affairs along with the Government of India has taken momentous efforts in restricting the tedious task of incorporation of a business in India.
In the event of the Republic Day, the government took strategic steps by bringing all the incorporation formalities under one roof and waived off the statutory fee. Some Key highlights are:
Zero Fee
- All government fee levied on SPICe form, eMOA and eAOA are reduced to Zero.
- Stamp duties depending on the state of incorporation will still be levied.
Reduced Time
- CRC claims to deliver incorporation approvals within 24 hours.
Simplified Procedure
- A new web-based form called RUN, Reserve Unique Name has been introduced for reserving or altering the company name.
- No prior requirement of DSC while applying for the company name
- Allotment of DIN is clubbed with SPICe form
For any startup or a budding entrepreneur, the most daunting task towards setting up the business legally is getting the company name registered.
The Government with the introduction of the RUN forms, claims that reserving a company name is now a child’s play. Does it indicate that an individual need not seek professional assistance before registering a suitable name for it its company?
Let us evaluate the intricacies of the RUN form, in comparison to the old form INC 1
| Particulars |
RUN Form |
INC-1 |
| Fee |
1000/- |
1000/- |
| Number of Name Options |
One |
Six |
| Number of Resubmissions |
Nil |
One |
| Number of Attachments |
Only one file up to 6MB |
Twelve different options |
| Affixing DSC |
Not required |
Required |
| Length of Form |
Short, with 4 sub-points |
Long, with 19 sub-points |
| Reservation of name post Approval |
- For a new Company: 20 days
- For an existing Company: 60 days
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An approved name had a validity up to 60 days. |
From the above table we can conclude the following findings:
- Inc1 form provided 12 name options for just Rs.1000/- (this includes the options of resubmission also). On the other hand, any resubmission in the RUN form due to the rejection of name will prove to be expensive for the applicant.
- Inc1 was a detailed and a complex form which required affixing of a DSC. On the contrary, the RUN form is short and simple which require minimum inputs.
- Post-approval of the name, the applicants will have to quickly move towards filing of the incorporation forms i.e. the SPICe form, since the validity of the name has been reduced from a period of 60days to just 20 days from the day of its approval.
Even though the RUN web form has re-engineered the complex name approval structure, yet the clause of no resubmission and a single attempt has increased the level of difficulty for a layman.
The applicants cannot blindly rely on the Quick Check System, as it does not guarantee cent percent name approval, even if it indicates the name is available as it does not cover all the parameters.
Therefore, it is advised to seek professional assistance to conduct a proper name search before applying for one, to minimize the chances of resubmission. The name selected should not be similar to any of the previously registered company or an LLP or a registered trademark.
About the author,
Kushaj Gupta
Has an impassioned zeal for penning the untamed thoughts. He likes to explore different realms of the technology-driven business world along with a legal touch. When not writing he is busy watching football or gaming for as long as he possibly can. Currently, he is associated with StartUpSection.com which is currently dealing in Company Registration in India, Annual compliances for Private limited Company and other associated activities.
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