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January 24, 2022by admin0

Do you have a great business idea? Or you have a business established but now it is time to register it in India? It is the time you first understand the important legal jargons to know before incorporating a company in India.

The 12 important legal jargons that will come handy while registering a business in India are listed below:

1. Company Incorporation:

The process by which company files required documents with the Registrar of Companies detailing the particulars of a proposed business entity.

2. Digital Signature:

A digital code (generated and authenticated by public key encryption) which is attached to an electronically transmitted document to verify its contents and the sender’s identity.

3. Registrar Of Companies:

The Registrar of Companies India is the official agency that deals with the administration of Companies Act 1956 & Companies Act, 2013. It falls under Ministry of Corporate Affairs. It has offices in all major states of India. The Registrar of Companies is the primary regulator for company- related matters in India.

4. Director Identification Number:

Director Identification Number (DIN) is a unique identification number for an existing director or a person intending to become the director of a company.

5. Book Keeping & Accounting:

Bookkeeping is the recording of financial transactions and is part of the process of accounting in business.

Transactions include purchases, sales, receipts, and payments by an individual person or an organization/corporation.

6. Patents & Trademark:

A patent for an invention or a business idea is the grant of a property right to the inventor. Patents are granted for new, useful and non-obvious inventions for a period of 20 years from the filing date of a patent application, and provide the right to exclude others from exploiting the invention during that period.

7. Memorandum of association (MOA):

Memorandum of Association is a legal document that explains why the organization was founded. It establishes the company’s authority and the terms under which it works. It is a manual that includes all of a company’s laws and regulations for its interactions with the outside world.

8. Articles Of Association (AOA):

Articles of association form a document that specifies the regulations for a company’s operations and defines the company’s purpose. The document lays out how tasks are to be accomplished within the organization, including the process for appointing directors and the handling of financial records.

9.  Corporate Identification Number (CIN):

CIN means Corporate Identification Number, and it is used by the Registrar of Companies for all companies registered in India. It is a unique identification number provided to you at the same time as your registration certificate.

10. Shareholders:

Any person, company or other institution that owns at least one share of a company’s stock is called a shareholder. Shareholders are a company’s owners. They have the potential to profit if the company does well, but that comes with the potential to lose if the company does poorly. A shareholder may also be referred to as a “stockholder”.

11. Company Secretary:

A company secretary is an officer appointed by the directors of a firm as responsible for ensuring that firm’s legal obligations under the corporate legislation are complied with.

12. Some Tax glossary

IT Returns:

Income tax return is a document you file with the Internal Revenue Service or the state tax board reporting your income, profits and losses of your business and other deductions as well as details about your tax refund or tax liability.

Goods and Services Tax

In simple words, GST is a tax applicable to the value added to goods and services at each stage in the supply chain. There are four types of GST, namely, CGST, SGST, IGST, and UTGST. Each type features different taxation rates applicable at the buyer’s end.

Professional Tax:

Professional tax is the tax by the state governments in India. Anyone earning an income from salary or anyone practicing a profession such as a chartered accountant, lawyer, doctor etc. are required to pay this professional tax.

Import Export Code:

An Importer -Exporter Code (IEC) is a key business identification number which mandatory for export from India or Import to India. No export or import shall be made by any person without obtaining an IEC unless specifical

Shop & Establishment Act:

The Shops and Establishment Act is a state legislation act and each state has framed its own rules for the Act. The object of this Act is to provide statutory obligation and rights to employees and employers in the unauthorized sector of employment, i.e., shops and establishments. This Act is applicable to all persons employed in an establishment with or without wages, except the members of the employers’ family.

The above legal jargon will give a heads up about the important terminologies that are used while setting up a business. You can also refer to the previous blog about important facts on business registration for more information.

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#179/2, GVR Ikon, 10th A Main Road, Double Road, Indiranagar 2nd Stage, Bengaluru-560038
Our locationsWhere to find us?

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Copyright by Legalsyne . All rights reserved.

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