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Quick Answer
A Private Limited Company is a separate legal entity registered under the Companies Act 2013, with limited liability, perpetual succession, and capacity to sue and be sued in its own name. Section 2(68) defines the type. Restrictions: minimum 2 / maximum 200 shareholders; restriction on right to transfer shares (typically through MoA/AoA); prohibition on inviting public to subscribe to shares. Private Limited is the default vehicle for VC-funded start-ups because it allows flexible share-class design (CCPS, ordinary equity, ESOPs).
Statutory reference
Section 2(68) Companies Act 2013
Incorporation runs through the MCA's SPICe+ form, processed centrally with stamp duty auto-computed at the state's rate — a clean filing completes in roughly 7–14 days and bundles DIN, PAN, TAN, EPFO/ESIC and optional GST. The decisions that matter are made before filing: entity choice (venture-capital fundraising and ESOPs effectively require a Private Limited over an LLP), a name that clears the trademark and MCA conflict checks, an authorised-capital figure that anticipates the first funding round, and — above all — founders' and shareholders' agreements with vesting and IP assignment signed at incorporation, when they are cheap. The post-incorporation calendar is unforgiving: first auditor within 30 days, share certificates within 60, the INC-20A commencement declaration within 180 (before which the company cannot trade or borrow).
Worked example
Two founders incorporate a SaaS startup as a Private Limited with a co-working registered office in Gurgaon's Cyber City (operator NOC plus utility bill). On their lawyer's insistence they sign a founders' agreement at incorporation: 4-year vesting with a 1-year cliff, IP assignment of all pre-incorporation code, and a deadlock-resolution clause. Eight months later one founder exits; the cliff and vesting mean he leaves with 12.5% instead of his full 50%, and the assigned IP stays with the company. The seed round closes on schedule — the investor's diligence flags nothing, because the fight that kills most young startups was papered out of existence on day one.
Related practice areas
Company under Section 2(68) Companies Act 2013 with restricted right to transfer shares, minimum 2 shareholders, maximum 200, minimum 2 directors. Default vehicle for Indian start-ups.
Private Limited Company is governed by Section 2(68) Companies Act 2013. A Private Limited Company is a separate legal entity registered under the Companies Act 2013, with limited liability, perpetual succession, and capacity to sue and be sued in its own name. Section 2(68) defines the type. Restrictions: minimum 2 / maximum 200 shareholders; restriction on right to transfer shares (typically through MoA/AoA); prohibition on inviting public to subscribe to shares. Private Limited is the default vehicle for VC-funded start-ups because it allows flexible share-class design (CCPS, ordinary equity, ESOPs).
Private Limited Company falls under Corporate & Business. NyaySevak matches you with a Bar-Council-verified advocate in the relevant practice area — your first step is a free case assessment with no obligation.
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