One of the most essential steps during the incorporation of a private limited company is the registration of business name. Every company that wishes to register itself under the Companies Act, 2013 shall propose the name of the company to the Registrar along with the application and the prescribed fee. The registered name of the company or business is stated in the Memorandum of Association.
Steps to register a business name
1. Check availability- the first step of registration of business name requires checking the availability of the name of the company. The proposed name shall not be similar to that of any other company already in existence. A business or company can propose 6 names to the Registrar and it shall register the name which is deemed to be fit and is not in violation of the provisions of the Companies Act.
2. Application for registration- once the availability of the proposed name of the business is checked, the company shall make an application in the prescribed manner, along with the required fee to the Registrar for the reservation of the name of the company as proposed in the application. Similarly, an application can also be made to the registrar for alteration of the existing business name. Rule 9 of the Companies (incorporation) Rules 2014 states that an application for registration of business name is to be made in Form No. INC.1 along with the required fee.
3. Reservation of Name- once the application for registration of business name is made to the registrar, it may look into the documents and information furnished along with the application and reserve the name of the business or company for sixty days from the date of such application.
Restrictions for registration of business name
Registration of a business name is subjected to certain restrictions laid down in the Companies Act, 2013 and Companies (incorporation) Rules, 2014. Name of a company can not be registered in the following cases:
1. If the name of the company to be registered is identical with or resembles that of an existing company registered under the Companies Act.
2. If the use of such name by the company will constitute an offence under any law for the time being.
3. If the Central Government is of the opinion that the name of the company is undesirable, it will not e registered.
4. A company shall also not register a name which is likely to give the impression that it is connected with the Government of India.
To register its name, a company or business shall furnish correct information. If the information is found to be incorrect, the Registrar of Companies may cancel the reserved name and the person making the application will be liable to pay a fine of Rs. 1 lakh.