Registration & License

What is Startup?

A startup can be interpreted as a newly established business started by one or a group of individuals. What differentiates it from other new companies is that a startup offers a new product or service that is not being provided elsewhere in the same way. The keyword is innovation. The business either develops a new product/ service or redevelops a current product/service into something better.

Department for Promotion of Industry and Internal Trade (DPIIT) considers an entity as a startup for ten years from incorporation date subject to the fulfilment of the following conditions:
 
1. The Company should be incorporated as a Private Limited Company, LLP or Partnership firm.

2. The Company is eligible for the various benefits of a Startup up to ten years from the date of incorporation.

3. The Company's turnover should not exceed One hundred crores for any financial years since incorporation.

4. The eligible Company should work on innovation, development, or improvement of products or services. The Company's business model should be scalable with a high potential for wealth creation or employment generation. 

5. It should be a new entity, i.e., not formed by splitting up or reconstruction of an existing business or by transfer to a new company previously used for any purpose.

The objective of the Scheme

The intention behind this Startup is to promote growth and to help the Indian economy to help to develop and innovate products and services, and at the same to create employment and wealth generation in the country.

Startup Registration Process

An application for the online startup registration can be made to DPIIT to be recognized as a duly recognized Startup. The applicant can be file the application online from the website https://www.startupindia.gov.in/  or the mobile app. The following documents are required for registration:

1. Certificate of incorporation of the Company.

2. Details of the Directors.

3. Proof of concept like website link/pitch deck/Startup video (in case of a validation/ early traction/scaling stage startup).

4. PAN Number.

5. Patent and trademark details (Optional)

6. Write-up on the nature of business highlights incorporating how an entity is working towards development, innovation or improvement of products or processes or services, or its scalability in terms of employment generation or wealth creation. This forms the very basis of rejection or approval of the application and must be detailed.

7. Additional documents providing website link, Startup pitchdeck, details of patents, etc., shall also be attached to support the application.

8. Information on any award received by the entity.

9. Document proof of funding received by the entity, if any.

Benefits of Startup India Scheme

There are various benefits given to the Company who have registered themselves under the Startup Scheme. Following benefits are being given to entrepreneurs establishing startups:

1. 80% rebate in patent cost/ IPR protection.

2. Self-certification of six labour laws and three environmental laws through a simple online procedure. Only those startups eligible for this benefit, those who have recognized themselves under DPIIT within five years of incorporation.

3. Tax exemptions under Income Tax Act.

4. Easy winding-up process (within 90 days).

5. Easier public procurement norms.

Recognition and Benefits for Startups include Tax Benefits also. Once the Startup is recognized and registered by DPIIT, one may avail of the following benefits under Income Tax Act:

A)  Corporate Tax Holiday under sec 80-IAC

The deduction under section 80-IAC is available to an 'eligible startup' up to 100% profits out of 10 years from 01 April 2021 for any three consecutive years from the date of incorporation.

The following conditions have to be fulfilled to be considered as an "Eligible Startup" for claiming this deduction:

i) It should only be a company or LLP. A partnership firm is not eligible for such exemption.

ii) It is incorporated on or after April 1, 2016, but before April 1, 2021.

iii) Its turnover does not exceed Rs. 25 crores and 100 Crore from 01 April 2021 in any Financial Year since incorporation for which deduction is claimed.

iv) It holds a certificate of eligible business from the Inter-Ministerial Board of Certification (IMB) (by filing Form 1).

B) Relief from Angel Tax u/s 56(2) (vii b)

Eligible startups have to file a duly signed self-declaration only with DPIIT for availing exemption. DPIIT shall transmit these declarations to the Central Board of Direct Taxes (CBDT). The eligibility for availing tax exemption under Section 56:-

* It should have been recognized as a DPIIT.

* It should be a private limited company.

* It has not invested in specified asset classes.

* The Startup should not have invested in immovable property, transport vehicles above Rupees ten Lakh, capital contribution to other entities, Loans and advances, except in the ordinary course of business.

What is FSSAI?

The Food Safety and Standards Authority of India (FSSAI) is a legal authority that offers a food license to all food business operators (FBO) in India. It ensures the food products undergo quality checks thereby curtailing the food adulteration and sale of sub-standard products. It is responsible for the registering and licensing of the Food Business Operators (FBO) in India and it lays down the rules and regulation for running the food business in India.

FSSAI license and FSSAI registration:

Sometimes people are confused about this as they do not know the difference between FSSAI Registration and FSSAI License.

FSSAI Registration: FSSAI registration is required for a category of food business which is called petty food business. Petty food business or petty food operator is defined as an FBO who is a manufacturer or sells any article of food himself as a petty retailer, hawker, itinerant vendor or temporary stallholder. If an FBO distributes foods in any religious or social gathering and the turnover does not exceed Rs 12 lakhs. FBOs in this category are required to obtain an FSSAI registration by submitting an application for registration in Form A. FSSAI registration certificate contains the registration number and a photo of the applicant. FBO has to display this certificate at the place of food business at all times while carrying on the food business.

FSSAI LICENSE: Any person or company which cannot be categorized as a petty food business operator is required to obtain an FSSAI license for operating a food business in India. An applicant can apply for an FSSAI license which is of two types, State FSSAI License and Central FSSAI License. Based on the annual turnover and presence in one or more states, FBOs need to apply for State or Central License. Any large food business which is manufacturing, processing, transporting and importing food products require central FSSAI license while medium-sized food manufacturers, processor, and transporters need a State License. The fee and process of obtaining an FSSAI license is more complex than securing an FSSAI registration. FSSAI license application is made in Form B while for FSSAI registration, the applicant is required to fill Form A.

Eligibility for applying for an FSSAI registration:

For FSSAI Registration:

Day 1 Preliminary Requirements

·         Provide basic details & documents required for registration.

Day 2-3 Collection and Collation of Documents and Informations.

• Filling the form for registration
• Gather the necessary documents

Day 4 Final Application filing

• Making applications for registration under FSSAI

Day 6 Approval

• Government processing time

The Process

For State and Central FSSAI License:

Day 1 Preliminary Requirements

·         Provide basic details & documents required for registration.

Day 2-3 Collection and Collation of Documents and Informations.

• Filling the form for registration
• Gather the necessary documents

Day 4 Final Application filing

• Making applications for registration under FSSAI

Day 6 Approval

• Government processing time

What is MSME registration?

MSME stands for Micro, Small and Medium Enterprises. In a developing country like India, MSME industries are the backbone of the economy. MSME registration is a mandatory task for any business to start and operate in India. The registration is free of cost and is categorized under two main categories, such as manufacturing enterprises and service enterprises. Government grants various benefits to MSME.

Important MSME Revised Guidelines and Threshold limit

Benefits of MSME registration:

·         Bank Loans without collateral

·         Subsidy on Patent Registration

·         Overdraft Interest Rate Exemption

·         Industrial Promotion Subsidy Eligibility

·         Protection against Delayed Payments

·         Electricity Bills concession

·         ISO Certification Charges Reimbursement

Documents required for MSME Registration:

·         Address proof of the Business

·         Copy of Industrial License(if any)

·         Bills of assets(if any)

·         ITR(if any)

·         Aadhar card

·         Pan Card

·         Bank Details

·         Partnership Deep (If Unregistered firm)/Registration Certificate(If Registered)

·         Additional Documents Required in case of Company:

1.       Memorandum of Association

2.       Article of Association

3.       COI

4.       BR and SR

5.       PAN an d TAN of company

            Steps for MSME Registration:

·        Preliminary Requirements

        1.     Select a suitable package.

        2.     Provide basic details & documents required for Registration.

        3.     Make Payment through Secured Payment Gateway

·        Registration

        1.     Application for MSME Registration

·        Completion of MSME Registration

          1.     Issuance of MSME certificate.

*MSME certificate will be issued with 2-3 working days subject to the Government processing and approval.

Process of MSME Registration:

                Day 1:

·        Provide basic details & documents required for registration.

                Day 2:

·        Application for MSME registration.

            Day 3-4:

·        Issuance of Certificate*

*MSME Certificate will be Issued with 2-3 working days subject to the Government processing and approval.

Shop and Establishment act

Shop and Establishment act is enacted to provide statutory obligation and rights to employees and employers in the unorganized sector of employment, i.e., shops and establishments. “Establishment” means a shop, commercial establishment, residential hotel, restaurant, eating house, theatre, or other place of public amusement or entertainment to which this Act applies and includes such other establishment as the [State] Government may, by notification in the Official Gazette, declare to be an establishment for the purposes of this Act.

Documents Required for Shop & Establishment Registration

• Photograph of the Shop or Establishment at the entrance with Name Board in local language
• Certificate of Incorporation, MOA & AOA of Company / LLP Agreement of the Company or LLP
• Copy of PAN card
• List of Directors or Partners and their ID & Address proof
• Copy of Board Resolution or Partners Consent
• Address proof of Company/LLP/Partnership/Proprietorship
• Details of all the employees if any.

Benefits:

• Evidence for opening Current account: Registration in Shop and Establishment Act can be used as a proof for opening of current bank account for enterprises.
• Proof of Existence: Registration in Shop and Establishment Act provides a legal identity to the business and it serves as an proof of existence of enterprise.
• Benefits in labour law: After registration in Shop and Establishment Act, enterprises can avail various benefits in labour laws.

Steps for Shop and Establishment Registration:

• Preliminary Requirements

1. Provide basic details & documents required for Registration.
2. Make Payment through Secured Payment Gateway 

• Registration

1. Application for Registration

• Completion of Registration

1. Issuance of certificate.

Process of Shop and Establishment Registration:

Day 1:

• Provide basic details & documents required for registration.

Day 2:

• Application for Shop and Establishment registration.

Day 3:

• Issuance of Certificate

l.

Import Export Code

Import Export Code (also known as IEC code) is a 10 digit identification number that is issued by the DGFT (Director General of Foreign Trade), Department of Commerce, Government of India. It is also known as Importer Exporter Code IEC (Import Export Code) license is one of such prerequisites when you’re thinking of importing or exporting from India. It is also known as Importer- Exporter Code. IEC (Import Export Code) is required by anyone who is looking to kick-start his/her import/export business in the country. It is issued by the DGFT (Director General of Foreign Trade). IEC is a 10-digit code that has lifetime validity. Predominantly importers merchants cannot import goods without the Import Export Code and similarly, the exporter merchant cannot avail benefits from DGFT for the export scheme, etc. without IEC..

Benefits of IEC:  

1. International Exposure: IEC helps you to tap the international market to grow and diversify your business.

2. Government Benefits: Government of India always promote the export activity in India so through IEC Code Registration you can avail all the export scheme benefits from DGFT, Customs and Export Promotion Council.

3. No Renewals: IEC Code issued by the DGFT for the lifetime validity.

4. No annual compliances: There is no annual compliances for IEC holder for use of IEC like return fillings, etc.

Documents Required for Import Export Code (IEC) Registration

• IEC Code Registration required following things:

• Individual Person

• Personal or Company or Firm Pan Card Copy.

• Personal aadhar card or voter id or passport copy.

• Personal or company or firm current bank account cancel cheque copy.

• Electricity Bill Copy or Rent Agreement or Sale deed of the premise copy

Steps for IEC Registration:

·        Preliminary Requirements

1.     Provide basic details & documents required for Registration.

2.     Make Payment through Secured Payment Gateway

·        Registration

1.     Application for Import Export Code

·        Completion of IEC Registration

1.     Allotment of IEC.

*IEC will be allotted with 10-12 working days subject to the Government processing and approval.

Process of IEC Registration:

Day 1:

·        Provide basic details & documents required for registration.

Day 2:

·        Application for IEC registration.

Day 3-12:

·        Allotment of IEC*

* IEC will be allotted with 10-12 working days subject to the Government processing and approval.