Pawan incorporated a Private Ltd. Company in the year 2016 for carrying on the business of supplying freshly chopped vegetables to various food chains in and around New Delhi NCR. He wants his entity to be recognised as
CS Executive · Setting up of Business Entities and Closure · PYQS · December 2019
Pawan incorporated a Private Ltd. Company in the year 2016 for carrying on the business of supplying freshly chopped vegetables to various food chains in and around New Delhi NCR. He wants his entity to be recognised as a start-up. Advise the process to be followed by him for recognition of his company as a start-up.
Answer & Explanation:
The recognition of the startups in India is regulated vide notification G.S.R. 127(E) issued by the Department for Promotion of Industry and Internal Trade (DPIIT) dated 19th February, 2019. The entity shall be considered as a Startup: (i) Upto a period of ten years from the date of incorporation/ registration, if it is incorporated as a private limited company (as defined in the Companies Act, 2013) or registered as a partnership firm (registered under section 59 of the Partnership Act, 1932) or a limited liability partnership (under the Limited Liability Partnership Act, 2008) in India. (ii) Turnover of the entity for any of the financial years since incorporation/registration has not exceeded one hundred crore rupees. (iii) Entity is working towards innovation, development or improvement of products or processes or services, or if it is a scalable business model with a high potential of employment generation or wealth creation. The process of recognition of an eligible entity as startup shall be as under: (i) A Startup shall make an online application over the mobile app or portal set-up by the DPIIT. (ii) The application shall be accompanied by- (a) a copy of Certificate of Incorporation or Registration, as the case may be, and (b) a write-up about the nature of business highlighting how it is working towards innovation, development or improvement of products or processes or services, or its scalability in terms of employment generation or wealth creation. The DPIIT may, after calling for such documents or information and making such enquires, as it may deem fit, - (a) recognise the eligible entity as Startup; or (b) reject the application by providing reasons.
Topics: Business Structures
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