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Rishi Kesh (Manager)     15 November 2011

Need help in starting up a new company

Hi everyone, i am planning to start 2 businesses as partnership concern. I have some questions.. I hope you guys can help me out..

1. Should be register each and every business seperately or i can start a group of companies and have the other business running under that?

2. If i create a current account in a bank in one business name, can i use the same account to get money to  other business with different name or i should open new account for each business?

3. Where do i go about registering the company names?

5. In future if i want to make it a private limited company will there be any issues?

6. For now i will be running the business from my house. so i'll be giving my house address.. Will that be an issue?

7. Can i register for memorandum here: https://www.msmeonline.tn.gov.in/ can i show this as an address proof for the company?

8. I will be importing some products from china, taiwan and malaysia. They will be electronics and consumer products. Should i obtain any special licence to do this? Also i heard its better to hire some brokers to import the items without any problems.. Any help on this will be highly appreaciated..

Please forgive my dumbness with these questions. I am completely new to business and have a lot of questions running around my mind. The more i read the more i get confused. i sincerely hope some one will clear my doubts.

 

P.s. I will be starting the business from Chennai.



Learning

 10 Replies

Sankaranarayanan (Advocate)     15 November 2011

yes best of luck,  where are you in chennai. i am also from chennai.

1 Like

Sanjay (Genl Manager)     15 November 2011

Dear Rishikesh,

First of all best of luck for your ventures.

I am a Mangt graduate and not a law grad - I am also i the same boat like yours evaluating some ideas of staring new ventures. Basis my limited elarning I am explaining you some aspects with regard to the questions.

Request you all experts to excuse me and correct me if there is something said my me which is contrary to the general practice.

1. Please evaluate between a partnership firm and pvt ltd. company. My view is that starting a pvt limited would always be ideal especially when you are starting a impex firm. This would reduce your liability from the unfortunate events should any occur. a partnership is easiler to open and close on a com][paritve scale to company pvt ltd, but the liability is more in partnership as compared to pvt ltd.

2. Regarding number of companies, my suggestion is start as individual companies with the parent company holding major stakes in others - structure as a business vertical each of the core product segments you are interested in venturing. This way when the daughter company grows bigger either you may take over or consolidate it with the parent or still run it sperately from others and keep the lesser profitabel ones away. You can then decide either to merge with the parents and then close that product line slowly later as closing a company would involve a lot of bitter process as per Indian rules. This you can decid basis the leaglities and money & time involved.

3. Please excuse me for being blunk in above but you must note and create a strategy for this - basically this strategic thought stems from the fact that electroncis product lines look lucrative for a period but also become absoluete in a very short frame and hence you need to keep changing and eveolving or adapting the ever fast changing electronics lines.

4. Registering company names will need to be done with the registerar of companies. For this you may need to get in touch with CA firms who specialise in this work of company formation. They may also throw mroe light on the aspects explained above.

5. Please discuss the liability part explained above with legal expert in company law and understand the impact more in detail.

6. Address of home is not a major concern ecept that please check if you are in an apartment the society should not have any objection in you using the residential space for commercial purposes.

7. with regard to  import - first and primary step is to get an IEC number - Import Export code number which is a permanent idenfication number that you need to mention in many of the statutory filings wrt impex (import export).

8. also please make yourself conversant with Incoterms and always use LC route for payments. never pay in advance unless you are sure and it is requred. With regard to Incoterms also be careful which years incoterms you are using like 1994, 2000, 2010 etc. These all play a vital role in the transfer of title, risk, interest, property (legal dfinition) and points in time frame of payments.

9. Also you may need to apply in the bank for forex accounts separately - basic rule kep forex accounting and indian rupee accounting separately to the extent possible - as so to shield yourself from risk in forex rate changes.

10. Pls excuse me, if you are aware of the above, but as a friend thought i did highlight these to you as these are vital in the planing stages itself.

However, if you are interested to know mroe about these, please contact me and i am more than glad to share with yourself many more.

Also friend, I was brought up in chennai and did my schooling there in DAV.

Regards

1 Like

Sanjay (Genl Manager)     15 November 2011

Dear Rishikesh,

Further to the above you may also note,

11. Employ brokers only to the extent requried, excluding brokers on one side it may be that you may save costs, but other side, brokers are requried as they are beneficial to help you with small lots and other aspects for easy negotiation, etc.

12. You must also find good CHA (customs handling agent) or freight forwarder who also handles customs) who can help you with proper filing of documents in timely and correct details at the port or airports and arrange for clearance. any mistake will only lead to wasteage of funds and times and lock of funds realisation for you. CHA or FF must be conversant with the proper classification codes of the HSC as per EXIM Handbook else the duty imposed may be differnet from what you may thinnk. you need to keep tab on that and get proepr advic before quoting, as the profits will sway basis the rates.

Regards

Rishi Kesh (Manager)     15 November 2011

Hi Sanjay. First of all thank you so much taking your valuable time in answering my questions.

 

Everything you told here is completely new to me and taken my ignorance to the next level :)

I cant thank you enought for showing me the light. Do you by any chance know some one who can get this done for me? Especially getting that IEC number as its a vital part for my business.. I have also PMed you my number. If you have time, please SMS me your number and i will call you to get more details.

 

Many thanks :)

Rishi Kesh (Manager)     15 November 2011

Originally posted by :sankar narayanan
"
yes best of luck,  where are you in chennai. i am also from chennai.
"

Thanks Sankar. I am based in Nungambakkam

Rajesh Hazra (Mediator and Legal Counsel )     16 November 2011

Dear Rishi

You also think on the option of LLP.

Advocate/CS Sanjeev Kataria ( Advocate)     18 November 2011

It is better to start your business as a pvt ltd company. Hire the services of a qualified practicing company secretary for all the details or visit our website aksinghcs.com for any querry or assistance. 


(Guest)

Form a Limited Liability Company online as it'l give you advanteges of a Corporation, Hardly any taxation and freedom to involve in International Trade as per GATT:

Get it here.

https://www.incorporate.com/tv

 

Do it in Delaware/Kentucky which are least expensive. In case of difficulty revert back to me.

SURESH GODBOLE (ADVOCATE)     18 November 2011

Engage an agent /Lawyer / CA firm to get you registration quickly , and him his fees


(Guest)

And pay mutiple taxes and agent/lawyer/ca fees from which you'll never get out. They will make you bankrupt and tear your company apart.


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