Certificate of commencement of business

Are you in the process of incorporating a company having share capital? If yes, then procuring a Certificate of Commencement of Business becomes indispensable. The recently declared Companies Amendment Ordinance, 2018 has reinstated the idea of “Commencement of Business”. It was earlier removed by the Companies (Amendment) Act, 2015. All the new companies which are to be incorporated can now commence their business operations only after getting the approval for Commence Business from the Registrar of Companies. As per the Companies Amendment Ordinance, 2018; all the companies incorporated after 2nd November, 2018 having share capital will have to seek an approval to Commencement its Business from the Registrar of Companies before starting any business operations or applying any borrowing powers. It is a basically an approval by the Registrar of Companies to the companies having share capital, only after which the company can start its business. Let us comprehend what…

Common mistakes you can avoid when incorporating

It’s a world full of startups. It takes a lot of efforts, time, and money to convert your innovative ideas into a business. The other most important thing and the biggest challenge is that the business turns out profitable. One must go through a lot of research processes before transforming the ideas into a profitable business. There are a lot of questions back from the mind before you think to incorporate your venture. You don’t even really know whether it is the right time to start up a business or not. We all know that to err is too human. However, let us go through some of the common mistakes that one can avoid while incorporating their first venture for the first time. Sufficient research is a must For being able to transform your ideas into a viable and profitable business, it is necessary that you do adequate research. Complete…

Convertible notes

Are you an upcoming start up based in India and reaching out to likely investors for investments? Luckily you get an investor based out of India who is willing to invest in your start-up. However, is it possible for him to do so? Foreign Investors were not allowed for any Foreign Direct Investments (FDI) in debt instrument in India. However, with effect from January 10, 2017; the Foreign Exchange (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 was modified by RBI and it allowed the “startups” to issue convertible notes to the foreign investors. Let us understand what exactly is the concept of a convertible note. What is a convertible note?As per the amended Companies (Acceptance of Deposits) Rules, 2014; a convertible note is a debt instrument which is repayable at the option of the holder, or which is convertible into equity shares of the…

Export benefits under government schemes

After the “Make in India” initiative by the Modi government, the Indian exports have increased in massive folds. There are numerous export schemes, financial aids, and other benefits provided by the Government of India to the exporters which have led to this sudden increase in the exports. The following are the various export schemes provided by the Government of India so that Indian economy improves and there is an also an increase in the foreign exchange reserves: Advance Authorization Scheme: This scheme allows the businesses to import the input within the country without paying any duty. However, such inputs should be utilized further for the production of an export item. Advance Authorization for Annual Requirement: Advance Authorization for Annual Requirement: This scheme is for those exporters who have had excellent export performance in a minimum of the last two years. Such exporters can benefit from the Advance Authorization for Annual…

How to start a NGO?

What is a NGO?Non-Governmental Organization (NGO) is an association which is formed, managed and functioned for the benefits and upliftment of the lower segments of the society. These are no profit organisations which have different objectives and aims as compared to the profit making organisations. Incorporating a NGO in India is not an easy task. Apart from the money; a lot of hard work, determination and a real yearning to help others is needed to start a NGO. NGO unlike the company is formed for the wellbeing of the society without expecting any profits. Are you willing to start a NGO in India?? If yes, let’s go further on how to proceed with it. How to start a NGO in India? To start a NGO, the first step is to list down the reasons and the mission for which the NGO is to be started. Thereafter, a board of Directors/…

Foreign company starting business in india

Narendra Modi’s “Make in India” campaign has attracted many foreign companies across the world to investment in India or to open their own branch in India. It’s not that easy for a foreign company to start its business in India. There are many approvals which are to be taken and, numerous regulations which are to be followed. Are you a foreign company willing to start your own business in India? Well, in that case let us help you understand all the regulations that you will have to follow while you start your business in India. Let us first understand the concept of foreign companies in India. What do you mean by a foreign company in India? “Foreign Company” as per section 2 (42) of Companies Act 2013 is defined as any company or body corporate which is located outside India and has its place of business in India either by…

How to close a company?

Are you a company incorporated in India under the provisions of the Indian Companies Act? Do you wish to close your company? There are ample of reasons a company gets affected and thus, the best option for the company in such an event will be to get closed. There are different ways in which a company can be closed. Let us go through the different ways in which a company can be closed. A company can be shut in the following ways: Striking off the Company:Any defunct company can be strike off, under the provisions of Section 560 of the Companies Act, 1956. Such defunct companies who wish to strike off their name from the register of the Registrar of Company need to apply in Form FTE. The name of the defunct companies can be strike off from the register which is retained by the Registrar of Company as per…

Process of raising venture capital funding

Are you a start-up and looking to raise some funds through Venture Capital? It is a humungous process to raise funds through Venture Capital, several stages are involved in the process which are very time consuming.On an average 45 to 90 days are usually taken to wind up the whole Venture Capital deal. Let us go through the process of raising funds through Venture Capital.The first step involved in the process of raising funds through Venture Capital is the execution of the Term Sheet between the founders and the Venture Capitalists. Let us understand the first stage of the process of raising funds through Venture Capital. Term sheet:It is the primary document which provides all the major commercial, economic and governing terms and conditions of the projected investment. The term sheet comprises of pre-money valuation of the company, the transaction structure’s instrument, privileges and duties of the investors, composition of…

Expectations of fintech startups from the budget 2019

Until the year 2016, not all of us were aware of the fintech market. However, thedemonetization helped the fintech market to become famous. There are many expectations for the fintech market to grow in various sectors considering the initial rate of growth. The fintech market has had too many expectations from the Union Budget 2019. Some of their demands from the Union Budget 2019 are: Help to restart the financial services market by looking at NBFCs as an essential source of capitalProvide the financial institutions an entry to short term capital in periods of stress to assist fintech startups to grow quicker and to offer more services to the retail customersGive more transparency on eKYC using Aadhaar and after that, provide them the importance of digitalization.Improve the infrastructure by promoting digitalization of bank transactions in rural India.Introduce such incentives and provisions which will make P2P get an active mechanism for…

Everything about venture capital

Are you forming a startup or planning to raise funds or some investments? Well, there are different ways to raise funds by a startup like crow funding, angel investors, taking a loan, taking money from friends and family and venture capital. Let us first understand the concept of Venture Capital. WHAT IS VENTURE CAPITAL? It is a finance which is made by the Venture Capitalists in an early start – up companies. The Venture Capitalists are the ones who invest their money. It is invested in small businesses or the ones which are at an initial stage but have an enormous growth opportunity. Venture Capital is a source of funding for such companies who have large up – front capital requirements. It is considered as a vast capital risk as it comprises the risk of losing the money in case if the start -up does not succeed. When the Venture…

Everything you need to know about treds

Over the years, micro, small and medium enterprises (MSME) have been facing issues forconverting their trade receivables into liquid cash. Also, they have been facing problems in obtaining sufficient finance. To overcome this issue of MSMEs, Reserve Bank of India (RBI) introduced the concept of “Trade Receivable Discounting System (TREDS)”. Have you been a MSME? Are you facing similar troubles related to raising finance for the business or converting the trade receivables into liquid funds? Then probably “TReDS” can come to your rescue. Let us first understand the concept of TReDS. WHAT IS TReDS? It is an online platform which helps the MSMEs to simplify the financing of their trade receivables over different financiers. It also helps the MSMEs to discount its invoices as well as bills of exchanges which are raised against the corporates and other buyers, Government Departments and PSUs, in turn helping them to reduce the working…

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