Subsidiary Company is a company that is owned (Fully or partly) and controlled by another company. When a company exercises control of another company, the later company usually becomes a Subsidiary company. The former company which keeps control of the subsidiary company is termed as Parent Company or Holding Company. The control of the subsidiary company is in the hand of the Holding company. The Holding company holds an interest in the Subsidiary Company.
A subsidiary company is termed as subsidiary or sister company. In this topic, we will discuss Indian Subsidiary company registration, documentation, and procedure required for it.
What is the Indian Subsidiary Company Registration?
In Indian Subsidiary Company Registration, the Subsidiary company is registered, which is owned and controlled by the Holding Company. A subsidiary company is defined under Section 2(87) of the Companies Act, 2013.
A Subsidiary Company concerning any other company means a company in which the Holding company-
- Controls the structure of the Board of Directors, or
- Exercise/Controls more than one-half of the total voting power either at its own or together with 1 or more of its subsidiary company.
In simple words, For Indian Subsidiary Company Registration, the holding company must own at least 50% of the subsidiary. A Subsidiary Company can be registered as a Private Limited Company or Public Limited Company.
Procedure to incorporate an Indian Subsidiary Company
To incorporate an Indian Subsidiary, the same process is followed as of the Private/Public Company in India. The applicant company needs to understand the procedure laid down by the authority (MCA) for company incorporation. The company must be registered with the Registrar of the Companies.
For incorporation, SPICE + is to be filed. SPICE+ FORM comprises of 2 parts-
PART A – Name reservation
PART B – Other processes of incorporation. After Name reservation, it covers all the incorporation application i.e.
- DIN Application.
- Issue of PAN and TAN
- Mandatory issue of EPFO, ESIC Registration, and also professional tax registration (In Maharashtra).
- Bank Account for the company.
- GSTIN Allotment.
For incorporation, it is a prerequisite to obtaining a Digital Signature Certificate by the Certifying Authority. DSC ensures the authentication of the document.
Documents required for Indian Subsidiary Company Registration
The document required for Indian Subsidiary company registration is as similar as documents required for company registration –
- Id and Address Proof of the directors and shareholders. However, in the case of the foreign applicant, Passport is mandatory, and all the documents must be certified by the Indian Consulate.
- Before applying for registration DSC of the director is required.
- Photographs of the directors and Shareholders.
- DIN of the designated directors and shareholders.
- SPICE+ Memorandum of Association and SPICE+ Article of Association.
- Address proof of the Registered Place of business.
- Rent Agreement (If the director has taken a property on rent). However, in the case of Owned Property (Copy of Property papers is required).
Other details that are required for incorporation
- Type and class of company
- Description of the capital layout of the company.
Documents required as an Attachment
- Id and Address Proof the subscriber and directors.
- MOA AND AOA
- Proof for a place of business i.e., address proof of office.
- Declaration by the first director and the subscriber
- Certificate of Incorporation of the Foreign Company and all the documents related to it. i.e., MOA and AOA of the respective Company.
- A copy of the resolution passed by the Foreign Company.
After filling all the requisite documents and by making online payment to ROC, the ROC, if satisfied, will issue a Certificate of Incorporation to the company.
Indian Subsidiary Company – Annual Compliances
Indian Subsidiary Company has to follow Annual Compliances as per the following acts-
- As per the Companies Act,2013 and filing of Annual Returns
- As per the Income Tax Act,1961 and filing of Income Tax Return
- FEMA Guidelines
- RBI Guidelines
- SEBI Guidelines
Indian Subsidiary Company is treated the same as the other type of Indian Company, and the rules governing the Indian Company are the same for the Indian Subsidiary company. If the applicant company complies with the above-mentioned procedure along with the documents, it will get the COI at earliest.
For more incorporation related query, you can contact us on Corpbiz; our experts will assist you to incorporate the Indian Subsidiary Company or any other type of company.
Read our article:Annual Compliance of a Public Limited Company: Rules and Procedures