Register an Indian Subsidiary

An Indian subsidiary is formed as a Private Limited Company and to register same, following requirements must be fulfilled:
1. Minimum 2 directors shall be appointed, out of which one must be resident in India.
2. Minimum 2 shareholders are required for this registration. Here, an individual may become shareholder and director at the same time.
3. A place of business in India must be provided as a registered office address.

100% Foreign Direct Investment is allowed in India in many of the industries under the Automatic Route. Under the Automatic Route, only a post-investment filing is necessary with the RBI indicating the nature of investment made. There are a few industries that require prior approval from the RBI, in such cases, approval must first be obtained from RBI prior to investment.

Foreign investment in any form is prohibited in businesses engaged or proposes to engage in the following business:
i) The business of chit fund; or
ii) Nidhi Company; or
iii) Agricultural or plantation activities (excluding floriculture, horticulture, development of seeds, animal husbandry, pisciculture, cultivation of vegetables, mushrooms, etc., under controlled conditions, services related to the agro & allied sector and tea plantations); or
iv) Real Estate business, or construction of farm houses (Does not include the development of townships, construction of residential/commercial premises, roads or bridges); or
v) Trading in Transferable Development Rights (TDRs)

This operational hand of a foreign entity in India is registered as a Private Company, which requires at least 2 members subscribing to shares. Hence, register as a wholly owned subsidiary, the parent company would subscribe all shares except one. This one share is by one of the directors to fulfill the requirement.

To register as a foreign company (private company), minimum authorized capital of INR 1 Lakh is prescribed, whereas the constraint of minimum paid-up capital is eliminated as a part of Government’s initiative to simplify business registration. However, each shareholder must subscribe at least 1 share for registration and introduce the amount sufficient to run the business.

The name of a company should be formulated as mentioned in the above section. The applicants can provide a maximum of 2 names with their preference order under the RUN form. The names provided should comply with the provisions of the Act or regulations.
You may apply with the name of the foreign entity to create a relation; however, the one has to check the availability of the name before making an application.

Yes, for any company registration in India at least one of the directors must be an Indian citizen and a resident. This criterion must be fulfilled all time during the existence of the company.

As derived from the definition of a foreign company, it can own a place of business itself or through an agent, physically or through electronic mode. Hence, it does not require having a physical place of business in India.
However, you must note that a place of business and a registered office are two distinct terms. The registered office must be in situated in India, where the formal communication to the company is made.

No, none of the promoters are required to be present at the whole process of Pvt Ltd company registration is online. All the forms are filed on the web portal and digitally signed. Also, the required documents can be sent through e-mail or uploaded on our portal for filing.

Yes, after incorporation and introducing equity fund from a foreign source of income, Reserve Bank of India must be notified about the foreign investment in the company through proper filing. In case the activity performed by the business requires Government approval for Foreign Investment, approval must be obtained prior to the funds being invested in the company.

During every financial year, the company must hold one Annual General Meeting (AGM) and at least 4 board meetings in each quarter. Further, the accounts and financial statements must be audited by the independent auditor. Subsequently, it shall file form AOC – 4 and MGT – 7 as part of Annual Compliance within given time.

The company needs to obtain the foreign KYC from foreign bank and FIRC (Foreign Inward Remittance Certificate) from AD to LegalWiz.in for filing such documents.

The company must file FLA before July 15 of next financial year. If the accounts are not audited by the given date, then the FLA Return is submitted based on unaudited (provisional) account. Further, once the accounts are audited, revised FAL must be file latest by end of September.

Daily transactions of the business are recorded in the Books of Accounts of the Company by the Accountant/s. The Accounts hence recorded are verified by an Independent Auditor to make sure that no statutory compliance are missed and provide an Audit Report for the same.
(Note: LegalWiz.in shall only take the accountability of the Accounting Service provided by them but however shall help in appointment of Independent Auditor for your business.)