Starting up Business in India – Beware of the ROC redtape !!
According to a published report (India 89, Pak 24, US 5), India ranks as one of the slowest countries in terms of the time taken to set up a new business. While it takes about 89 days to start a new business in India, in the US, it takes 5 days; in China, 41 days and in Pakistan, 24 days. For most developed nations, the duration varies between 10-40 days.
While the report does not say what kind of business is being compared, it is probably a private company that is being used as a yardstick for comparison.
I can vouch from personal experience that the 89 day duration for India seems to be fairly accurate. While starting up operations for Uzanto in 2004, we had applied to the Office of the Registrar of Companies (ROC) in New Delhi in the last week of March. The registration certificate was issued on the 2nd of June and thereafter it took a couple of weeks for the bank accounts to become operational. That makes it about 80-85 for our gestation period.
In my opinion, a 30-35 day period should be quite adequate for completing the startup requirements. Any delay beyond this is obviously due to beauracratic red tape. Needless to say, the ROC tries to act like an all-knowing godfather deciding on the pace and course of the startup process.
Let me share my experience to substantiate my assertion - In the application form, you have to specify three choices (in order of preference) for the company’s name for registration purposes. We had specified Uzanto Technologies as our first choice, quite certain that Uzanto being a very uncommon name, we should simply sail through this part. However those “babus” at the ROC office had other ideas. According to them, while Uzanto was fine, the usage of the word ‘Technologies’ made the name too generic; they insisted on changing it to ‘E-Technologies’ or ‘I-Technologies’ or something thereof. In spite of the most vociferous protests from our side, citing the examples of thousands of companies like Infosys Technologies, Wipro Technologies et al, they would simply not allow that. We tried to reason out with them but soon realized that all such attempts were futile.In sheer exasperation and in an effort to get over with it ASAP, we suggested Uzanto Consulting as the second choice and they relented.Off course, how is ‘Consulting’ any less generic than ‘Technologies’ is anybody’s guess? This wrangling over the name issue probably took up 20-25 days with frequent interactions between the ROC office and us over this issue.
However, a word of advice to anybody seeking it – the role of your Chartered Accountant is quite important in the startup process. Some CAs are far more dynamic and are able to exert a greater influence in their dealings with the ROC office. They have the right connections and know what it takes to handle those thick-skinned people at that office. Such people are likely to get the startup process completed much faster than others.
44 comments
I completely agree to the “role of CA”. We got ours done in just 2 weeks, I went to our CA’s office once to sign the papers thats it. But this is in bangalore not sure if ROC people are efficient here or it was our CA
Hi.
This is a good piece of information, especially for a person like me who wants to start a new business (my 1st one, though) in Bangalore.
Amit Rana, you’re in Bangalore and you say that your business start-up process was done in 2 weeks. Thats nice to know, keeping in mind the survey statistics (lol). I would request you to kindly give me the contact information of your CA, so that i could meet him for some assistance too. If u wish not to disclose the requested information here, you can mail me at sooraj.hasija@yahoo.co.in
Kind Regards,
SooRAJ.
Hi Amit Rama,
I would also like to know the contact information of your CA - could you please email it to:
michelleafox @ yahoo . com (no spaces).
Also, how much do the CA services cost and what do they do?
thanks,
Michelle
Hi Amit,
I am in the process of registering my startup. I wouldbe gateful if you could share some info on this along with the CA contacts, if you dont mind. Also if you can pls write abt the expenditure involved.
Please write to vhirema2000@yahoo.com
Thanks
Vijay
Hi Amit,
Can you please share some info about your CA and the cost involved?
Warm Regards,
Malan
[…] About a year back, I wrote a post on this very blog titled ‘Starting up Business in India– Beware of the ROC redtape!‘. This was basically a narrative, about how I had to spend three (exasperating) months in getting our startup registered with the office of the registrar of companies (ROC), New Delhi, as a private limited company. I must inform you that, to this day, that post remains the most popular post on this blog, attracting readers from various corners of the world. So much so that, if you Google for ‘Starting a company in India ‘, a reference to this post, is ranked number one amongst the 106,000,000 search results that Google throws up. […]
Dear Amit,
Hi, I am intrested in starting new small scale bussiness in Agricultural sector.
I am native of Ahamadnagar District,Central Maharashtra..
I have done my graduation in Chemical Engg and currently working with sales and proposal of one of leading company in Thermal Opeartions.
will you pls share your views.
Regards
Shrihari
I am also interested in starting my own small business in Bangalore. Any advice would be much appreciated, both in terms of approaching the Indian market, as well as ways to expedite the process.
yydalal@gmail.com
Thank you
Yasmin
Hi Amit,
I read your blog about 1 year ago when I was researching on enterprenuership and on the process behind incorporating a company. I have finally started out on my own. The best part is that I have started a division which specifically helps people get started by incorporating their company. We now provide online incorporation services where new companies are justa away. It gives me great pleasure to introduce http://www.dewcore.com to you and its services.
Hi Amit Rana,
I hope your new company is doing great. Wish you the very best in your venture.
I’d appreciate if you could please let me know about your Chartered Accountant. My email address is:
rpriyadarshi@hotmail.com
Thanks a lot again,
Rajeev
Hi All,
Amit or someone who has experience and a good CA, could you please let me know the CA details.
bangprop@hotmail.com
Hello All,
This is Sankeerth, looking for some information on as to registering or getting a licence for a voip provider company in India. Its a voip provider trying to launch in India and I would like to get some information on licensing the company in India. I would be thankful for any information provided regarding the information provided above
Thanks
Hi amit,
its good to know u r CAhas been approved in 2 weeks.I am also in plan of starting a new business
i wanted to know what all the things to be done before starting a new business. can u mail the required information as soon as possible.
Thanks & Regrds,
Suresha S G
Amit ,
Its really good to know your experience ,I am planning to start a new wholesale business in bangalore .
Let me know if you have some inputs .
Thanks in Advance
Ramesh
Hi Amit..!
Your case is one of almost all. I saw your profile on your website. I want your help. I am 21 and working in Accenture as a S/W Engg. I have some deep business thoughts to persue and I too want to do an MBA. Can you share some of your experience about how you started the business and what it took from yourside…I mean the domain expertise and other things..?
I will always be thankfull to you if you can give some of your precious minutes to mail me.
. .waiting
Hi All (and Amit Rana in particular),
I am planning to start a business of mine in Bangalore. So I need help who can walk me thru the incorporation of the company. Any pointer is highly appreciated.
Amit Rana, please share your CA details boss!!
Thanks,
Dips
Hi, I am an undergrad student and am working on a project for a class titled International Management. We have a business analysis to do on a nation of our choice. I chose India! Can you help me get started? We need to know how to start, advantages and disadvantages, problems or issues of the nation etc. The most important thing is that my sources have to be originated in India, I’m in the U.S. Can you offer any help?
Thanks.
Hi Amit,
Can you please mail me the contact details of your CA and the costs involved?Am currently working in Japan and the company wants to open a branch office in Bangalore.Looking forward to your reply.
Regds.,
Passang
oops..forgot to send my mail add: p_ssang@hotmail.com..thanks
Dear Amit,
I am a chemical graduate from Maharashtra working with one of the leading companies in India. What cost it takes for registration with ROC. Plz, write to gaurav_chem01@rediffmail.com
Hi Amit,
I am in the process of starting a new company in IT field. The company will be in Coimbatore.
It would be of great help if you could shed some light on the procedure to set up a new company.
What would be the role of CA in this process of setting up a company.
Also if you can please write about the expenditure involved during thisprocess.
Please write to karthik.kandavel@yahoo.com
I am looking forward to your early response.
Thanks and Regards
Karthik
Can someone provide me contact details of a CA who can help me in registering a company in Ghaziabad?
I have some very good ideas for the web.My question is how does one decide on the web hosting services, there are so much guidance available for doing same in India but very little for innovative web ideas in India.Can you please give me some pointers for the same?
Thanks
hi
shrihari and all
i am interested to start a small scale manufacturing business of raw material for phrmaceutical co.
what is the scope/market of this line of bisness.
and
i am CA working in africa for last 12 yrs.
any chemical engineeer tell me , that what would be estimated cost for this of this project at small level and
other legal requirements other than ROC.
thanks
hi gaurav
i am interested to start a small scale manufacturing unit in india to produce
raw materials for pharmaceutical co.
looking at my background, i dnt have any idea about this field
i am a chartered accountant working in south africa for th last 12 yrs .
now i want to come back and start some thing small in india.
can u please let me know the detail like:……………
what is the scope of this field ?
do i need to be a chemical engineer to start this business?
what would be the estimated cost to start at small scale?
thanks
narinder
Hi Amit,
How is your company doing now?
I am also planning to start up my own company. Kindly send me the contact details of the CA.
My e-mail id is itzmadhu@gmail.com.
Thanks,
Good Luck
Madhu
From chain of comments, I can make out 2 things…
either Amit just made aloose comment for generating interest for this blog… or such a profile doesn’t exist.
He commented last year, and people are still sending messages to him. Guys!!! wake up…find a CA and get it done.
dear entrepreneurs…. do yourselves a favour.
go to your parents, relatives or friends who file their income taxes and ask them about the chartered accountants whom they use. this is a sure shot and it is just 1 step away.
Nice informative blog.
Thank You Amit.
Hi,
I want to start a small firm in Bangalore; probably a recruitment firm, anyone please help me getting a CA in Bangalore. email me: career.blr@gmail.com
hi everybody
I work for a bank .Enterprenuers who wish to start their business in bangalore can write to rbhaskar27@hotmail.com.
Regards
Bhaskar
Great information. I too would like the details on your CA.
Thanks
well may be in old days it took lot of time. but then theer are always wys to get the things done very fast.I find that time mentioned by Mr Amit is unreasonably long , seems there was lack of proper follow up some where.
anyway, ROC and Income tax are online. all formalities can be completed sitting at youe desk. But one needs proper assistance and guideance.
For any help and assistance for statrting business, company formation, Income Tax etc. just send e mail to benturmitra@yahoo.com
Could you please help me out in knowing the taxes, policies, legal issues and procedures associated while starting a new business in service sector?
Regards,
Sumeet
Hi Amit,
I am planning to start a business in Bangalore.
Can you please share your experience and suggest a good CA to do quick and smooth process.
Thanks,
Upendar
Hello Everyone,
I am sorry I wasnt following comments. Ground work needed to start a company is not much and as I said just one visit, around 20-30KRs and 2 weeks are sufficient for that. Whats kills you is your first/second year end financial filing, form-16, PT, getting various numbers(registrations) etc. Please keep in mind all CAs “DO NOT” know everything that a software company’s CA should know. You can find most of the information http://www.doingbusiness.org/ExploreTopics/StartingBusiness/India-Bangalore.htm
We learned the hard way
I am happy to share any information you like. Feel free to email me amit [ at ] techjini.com
Regards,
Amit.
PS: I will be mailing individual people in this list to check if they still need CA reference
toptally related to you when you spoke about how the goverment org. wrk!!
i too m interested to start up a business of my onw. it would be really kind of you if you could help me out.
my questions will start once you get in touch theu mail.! thanks.
Dear Amit,
Its really nice to see someone share his experience with others who want to start their own Business. I am also planning to start up with something in Mumbai. It will be a Great help if you could help me with what exactly should I get into? There is a hell lot of confussion and I dont at any cost want it to be a failure. Kindly rply back on my email id:- pallavi_s_1983@yahoo.com.
Your reply will be most awaited.
Kind Regards,
Pallavi.
Dear Amit,
Its really nice to see someone share his experience with others who want to start their own Business. I am also planning to start up Statistical surveys Company In Madhya Pradesh. I have Expericens in National Sample Surveys Organization & I have A N G O. It will be a Great help if you could help me with what exactly should I get into? There is a hell lot of confussion and I dont at any cost want it to be a failure. Kindly rply back on my email id:-
Dear Mr. Amit Rana
Its nice that you are back with your comments and opinion.
But are the things really so diffcult and complicated as suggested by you….
As regards co. registration , everything is online and all formalities can be got completed from any computer sitting anywhere.From name approval to incorporation it does not take much time.
As regards other 1st or 2nd year filing, only after completion of financial year , one has to file returns with ROC and IT Return with Income tax that too online as both these departments are online.
other registration as mentioned by like PAN, TAN or VAT, Service TAx are also very simple for example service tax registration takes just one day.
And for your kind information,the web site you are advising people to visit for guidance , is not updated and does not contain proper information.
I am qualified professional involved into these things and I do not agree with you.Please do not misguide others if you do not have proper information and knowledge of the subject.
Regards
Jalaj Srivastava
benturmitra@yahoo.com
Hi,
Planning to start a trading company, basically importing and selling it locally. What is the procedure? With whom should I register?
Please reply
Hi Amit,
We are planning to register a chinese company for Pharmaceuticalis in India, can u let us know what is the actual procedure with the Time and Cost involved,also help us with the possible risks or Unpredictable mistakes that 1 does when undergoing this procedure.
Also let us know whether if that company is already registered in india with some other indian agent can we register that chinese company in our name.
[…] about the task of running their companies. I have done that extensively on my personal blog- here’s a post about how to tackle red-tape in the ROC office, here’s another one about putting […]