ibnlive » Business

Sep 04, 2006 at 05:32pm IST

Starting a company gets less taxing

New Delhi: People who want to set up companies in India say that the experience with the Registrar of Companies is not worth recounting.

For them setting up a company in less than a day is a pipe dream. But now the Ministry of Company Affairs says that they going to make sure that it happens.

The Ministry of Company Affairs is going to switch to a completely online system for filing papers.

So those who want to set up a company and even existing companies wanting to file returns will have to go to a web portal www.mca.gov.in built by Tata Consultancy Services for the Ministry.

"We have introduced a system in India that a company can be registered in just an hour or two," Minister of Company Affairs Prem Chand Gupta says.

The Industry seems to be welcoming this move but with a note of caution.

"For a country like India that has more than 6 lakh companies and a majority of them are small private sector companies so there are bound to be teething problems," Secretary Institute of Chartered Accountants of India Dr Ashok Haldia says.

The teething troubles are that the profit and loss accounts of private limited companies were published along with their balance sheets before both were blocked.

According to the law, only balance sheets are supposed to be made available and now companies are being asked to file then separately.

Companies also need to get a director's information number and a digital signature.

The Ministry says the benefits of this system far outweigh any problems.

The promise of greater efficiency has a lot of people excited but the Ministry still has a long way to go before it can boast of a completely paperless office.