As a business owner, there are many important numbers and registrations that you need to be aware of to run your company effectively. One of the most important is the CIN number.
The Corporate Identification Number (CIN) is a unique identification number assigned after company registration online in India. This number is crucial for all businesses, big or small, as it provides numerous benefits and advantages that can help your company succeed.
In this comprehensive guide, we will explore why every business needs a CIN number and how to obtain one.
Why CIN Number is Important?
Legal Requirement:
The first and foremost reason why every business needs a CIN number is that it is a legal requirement.
The Indian government has made it mandatory for all companies to have a CIN number.
Without this number, your company is not considered to be a legitimate business entity. You cannot conduct business, enter into contracts, or open a bank account without a CIN number.
Unique Identification:
The CIN number is a unique identification number that distinguishes your company from all others.
It is a 21-digit number that contains important information about your company such as its state of incorporation, registration number, and type of company.
This unique identification number makes it easier for your company to be identified and tracked by government agencies, suppliers, customers, and other stakeholders.
Transparency:
The CIN number promotes transparency and accountability in the business environment.
It provides important information about your company, such as its registered address, directors, and shareholders, which can be accessed by anyone through the Ministry of Corporate Affairs (MCA) website.
This transparency helps build trust with customers, investors, and other stakeholders and helps prevent fraud and corruption.
Branding:
Having a CIN number can help build your brand and credibility.
It demonstrates that your company is a legitimate business entity that is registered with the government and is following all legal requirements.
This can help attract customers and investors who are looking for reliable and trustworthy businesses to work with.
How to Obtain a CIN Number?
Obtaining a CIN number is a relatively simple process. It requires the following steps:
Step 1: Obtain Digital Signature Certificate (DSC)
The first step in obtaining a CIN number is to obtain a Digital Signature Certificate (DSC). This is a digital signature that is used to sign electronic documents and forms. The DSC is required to file the application for the CIN number online. You can obtain a DSC from a certified agency.
Step 2: Register on MCA Portal
The next step is to register on the MCA portal. You will need to create a user ID and password and provide your email address and mobile number. Once you have registered, you can log in to the MCA portal.
Step 3: Apply for CIN Number
The next step is to apply for the CIN number. You will need to fill out the application form online and submit it along with the necessary documents.
The application fee for the CIN number varies depending on the type of company and the authorized capital. Once the application is submitted, it will be reviewed by the MCA and the CIN number will be assigned if everything is in order.
Documents Required for Obtaining a CIN Number
The following documents are required for obtaining a CIN number:
- Identity proof of directors and shareholders
- Address proof of directors and shareholders
- Memorandum of Association (MOA) and Articles of Association (AOA)
- Board resolution approving the incorporation of the company
- Proof of registered office address
- PAN card of the company
Benefits of Having a CIN Number
- Easy access to credit:
Having a CIN number makes it easier for businesses to access credit from financial institutions as it provides a track record of the company's existence and financial history.
- Protection of personal assets:
A CIN number helps protect personal assets of the company's owners from being seized in case of business debt or legal issues.
- Compliance with legal requirements:
By obtaining a CIN number, a company ensures that it is compliant with legal requirements and regulations. This can help prevent fines or legal issues in the future.
- Improved credibility:
A CIN number helps build credibility for the company, which can lead to better business opportunities and partnerships.
- Access to government schemes and benefits:
Certain government schemes and benefits are only available to registered companies with a valid CIN number. By obtaining a CIN number, a company can take advantage of such benefits.
- Easy identification and tracking:
A CIN number makes it easy for government agencies, suppliers, and customers to identify and track a company, making it easier to do business with them.
- Protection of intellectual property:
A CIN number is required for registering trademarks, patents, and other intellectual property, which helps protect the company's assets and reputation.
Consequences of NOT Having a CIN Number
Not having a CIN number can have serious consequences for a business. Here are some of the potential consequences:
Inability to Conduct Business Legally
Without a CIN number, a business cannot operate legally in India. This means that it cannot enter into contracts, open a bank account, or do any other business activities.
Penalties and Fines
If a business operates without a CIN number, it can be subject to penalties and fines by the government. These penalties can range from a few thousand rupees to lakhs of rupees depending on the nature of the offense.
Legal Liability
Without a CIN number, a business is not considered a separate legal entity from its owners. This means that the owners can be held personally liable for any legal or financial issues that arise from the business.
Difficulty in Obtaining Funding
Most banks and financial institutions require a CIN number before providing loans or other financial services to a business. Without a CIN number, it can be difficult for a business to obtain funding.
Lack of Credibility
A business without a CIN number may not be seen as credible or trustworthy by customers, suppliers, or investors. This can make it difficult for the business to attract and retain customers and suppliers, as well as obtain investment.
Overall, not having a CIN number can severely limit the growth and success of a business, and can even lead to legal and financial issues. It is important for every business to obtain a CIN number and comply with all legal requirements to operate successfully.
Having a business without a website?
Then you are losing profit from your business.
Here are the 5 Reasons Why Every Business Needs a Website, which will make you aware about the necessity of a website in your business.
Read on to know more.
To survive and succeed in this Market your company needs to design a mobile-friendly website due to the following reasons:1.
Users: There are 85% or more consumers using a smartphone as their basic needs.
All the time these devices are in their hands and in the free time they browse the products and new companions for more information.
If your company website is mobile friendly then the chances of selling are high.
Trust building: If your company has a mobile-friendly website then the potential customer can search on the website for more details about the product and the company.
This is also beneficial to build up trust between the company and its existing customers.3.
