Registering a Public Limited Company in India is a major milestone for businesses planning to raise funds, issue shares to the public, or expand their corporate presence. Governed by the Companies Act, 2013, this structure offers credibility, perpetual succession, and access to capital markets.

However, the process of Public Limited Company Registration involves multiple compliance steps and legal documentation. Even a small mistake can lead to delays, penalties, or rejection from the Ministry of Corporate Affairs (MCA).

This article highlights the common mistakes during Public Limited Company Registration and how you can avoid them with professional guidance.

1. Incorrect or Duplicate Company Name

The company name approval is one of the most common causes of rejection. Entrepreneurs often submit names that:

• Resemble existing registered companies or trademarks

• Contain restricted or prohibited words (like “National,” “Bank,” “Exchange”) without government approval

• Are too generic or misleading

How to avoid it:
Use the MCA’s RUN (Reserve Unique Name) or SPICe+ tool to check availability and ensure compliance with the Company (Incorporation) Rules, 2014. Choose a unique and relevant name that reflects your business nature.

2. Not Meeting Minimum Director and Shareholder Requirements

A Public Limited Company must have:

• Minimum 3 Directors

• Minimum 7 Shareholders

• Minimum paid-up capital of ₹5 lakh

Many applications get delayed because these conditions are not met or the documents of proposed directors are incomplete.

Tip: Always ensure at least one director is a resident of India and all directors hold a valid Director Identification Number (DIN) and Digital Signature Certificate (DSC) before starting the process.

3. Improper or Incomplete Documentation

Incomplete documentation is one of the biggest mistakes during Public Limited Company Registration. Common issues include:

• Mismatch between name and address in PAN and Aadhaar

• Unclear proof of registered office (missing NOC from owner)

• Improperly drafted Memorandum of Association (MOA) or Articles of Association (AOA)

Solution:
Prepare the following correctly before filing:

• PAN, Aadhaar, and ID proofs of all directors/shareholders

• Address proof (utility bill within 2 months)

• NOC and rent agreement for office premises

• Correctly structured MOA and AOA defining company’s objectives and internal rules

4. Errors in SPICe+ Form Filing

The SPICe+ form integrates multiple applications (DIN, PAN, TAN, GST, EPFO, ESIC). Errors in even a single section—like share capital, address, or object clause—can cause ROC re-submission or rejection.

How to avoid it:
Double-check all entries, cross-verify attachments, and ensure DSCs are properly applied before submission. Professional review by a Company Secretary or CA reduces rejection chances.

5. Neglecting Post-Incorporation Compliance

Many companies make the mistake of assuming the registration ends with the Certificate of Incorporation (COI). In reality, the next steps are crucial:

• Conducting the first Board Meeting within 30 days

• Appointing an auditor within 15 days of incorporation

• Opening a current bank account and depositing share capital

• Filing Form INC-20A (Declaration of Commencement of Business) within 180 days

Failing to do these leads to penalties or even company strike-off by ROC.

6. Not Drafting the LLP or MOA/AOA Properly

The Memorandum and Articles of Association are the company’s constitutional documents. Mistakes in the object clause or shareholding pattern can create legal confusion later.

Example: Many founders forget to include “raising capital” or “issue of shares” as an objective, causing issues during IPO or private placement.

Tip: Always get your MOA and AOA reviewed by a professional before submission.

7. Non-Compliance with Share Capital and Securities Rules

A Public Limited Company must adhere to SEBI and Companies Act regulations before issuing shares or inviting public investment. Missing disclosure clauses or non-compliance with share issuance rules can lead to serious legal issues.

Ensure compliance with:

• Section 23 and 26 of the Companies Act, 2013

• SEBI (Issue of Capital and Disclosure Requirements) Regulations

• Allotment and valuation norms under Rule 13 of Companies (Share Capital and Debentures) Rules

8. Using Incorrect Registered Office Address

The registered office determines your ROC jurisdiction. Using a temporary or non-verified address can delay registration or trigger jurisdictional mismatch.

Best Practice:
Use a stable address with proper electricity/water bill proof and owner NOC. For startups, even virtual offices (with proper lease documents) are acceptable if compliant with MCA norms.

9. Ignoring Tax and Regulatory Registrations

Many founders overlook parallel registrations during incorporation, such as:

• GST Registration

• Professional Tax (if applicable)

• ESIC and EPFO

These can be integrated into the SPICe+ form or applied separately. Ignoring them early causes operational delays and non-compliance penalties.

10. Not Consulting Experts Before Filing

Public Limited Companies involve higher regulatory responsibility. Attempting self-registration often results in repeated rejections and compliance gaps.

Why consulting experts like Taxlegit helps:

• Guidance on capital structure, directors, and shareholding

• Error-free preparation of MOA/AOA

• Fast processing through MCA portal

• Post-registration compliance setup (Form AOC-4, MGT-7, ADT-1, etc.)

Conclusion

Public Limited Company Registration is a powerful gateway to scale your business, attract investors, and establish brand credibility. But small oversights—like missing documents, incorrect filings, or compliance delays—can result in significant legal and financial consequences.

By following the correct process, preparing accurate documentation, and working with a professional consultant such as Taxlegit Consulting, you can ensure a smooth, compliant, and timely incorporation journey.