START-UP INDIA REGISTRATION PROCEDURE

START-UP INDIA REGISTRATION PROCEDURE

Start-up India is the largest online platform for entrepreneurs featuring 60,000+ start-ups and 3.5 lakhs overall users.

It is a project mediated by the Indian government's start-up initiative, precisely by the Ministry of Industry and Commerce, Government of India, which aims to promote the start-up culture and give a boost to entrepreneurship in India.
 

Overview

Having registered at Start-up India, a budding entrepreneur can tick the following off their list as done:

  • It offers a network where start-ups can connect with thousands of investors, guides, incubators and shareholders to establish synergies for opportunities to enable prospective partnerships; 
     
  • It hosts programs and challenges organised by government and corporate agencies for start-ups to win cash prizes, incubations, pilot opportunities and other forms of support including investments in the start-up ideas.
     
  • The portal provides necessary information to start-ups and aspiring entrepreneurs, including information on the company incorporation and relevant schemes of the government.
     
  • The online tools and resources are free online courses, enterprise and management software, business templates, market research reports, etc. 
     
  • Start-ups can claim benefits apart from tax exemption, fast-tracking of patent applications and reduced compliance due to self-certification of some labour and environmental laws.
     

Procedure & Eligibility

To get recognition  as a Start-up under the Start-up India Scheme, a business entity must full fill the following conditions:

1. The start-up business must be registered as:

  • Private Limited Company under Companies Act, 2013;
  • Limited Liability Partnership (LLP) under the Limited Liability Partnership Act, 2008;
  • Partnership Firm under the Partnership Act, 1932.
     

2. The turnover of the business during any financial year since the time of registration/incorporation should not have crossed 100 crores in rupees;

3. The business objective is to work for innovation, development or improvement of products or processes or services, or it can be a scalable business model with a high potential of employment generation or wealth creation;

4. The business will be recognised as start-up for a period of 10 years from the date of its incorporation/ registration;

5. Any entity formed by splitting up or reconstruction of a business already in existence shall not be considered as a ‘start-up’.
 

Required Documents

  1. Incorporation/Registration Certificate: the certificate of incorporation of the company/LLP (Registration Certificate in case of partnership)
     
  2. Description of your business in brief: Acts like a proposal as to why the entrepreneur wants to work in the direction/the purpose or innovation of the start-up
     
  3. Founders/Promoters Information like email id and Mobile No.;
     
  4. Brief write up about the problem solving ability, creating wealth or employment, trademark information, if any.
     
  5. Any one of the following like website, pitch deck, vimeo video.
     

Process of Registration as a Start-up

One needs to follow the procedure to register as a start-up as given below:

1.  It is required that the entrepreneur registers the business as a Private Limited Company / Limited Liability Partnership / Partnership Firm;

2.  One needs to obtain PAN for the start-up;

3.  One needs to make a business proposal stating answers to the following:

  • What is the problem the start-up is solving?
  • How does the start-up propose to solve this problem?
  • What is the uniqueness of the solution to the problem offered by the start-up?
  • How does the start-up generate revenue?
     

4.  Details of any awards/recognition received by the start-up, if any.

5.  One needs to file the application at www.startupindia.gov.in with supporting documents such as Certificate of Incorporation / Registration. 

6.  Start-up India then reviews the application for recognition and if it fulfils the criteria it is granted the status of a start-up and the Certificate of Recognition is issued. 
 


 

Benefits of Being Registered Under Start-up India

1.  A start-up is permitted to self-certify compliance for 6 labour laws as follows:

  • Building and Other Constructions Workers’ (Regulation of Employment & Conditions of Service) Act, 1996;
  • Inter-State Migrant Workmen (Regulation of Employment & Conditions of Service) Act, 1979;
  • Payment of Gratuity Act, 1972;
  • Contract Labour (Regulation and Abolition) Act, 1970;
  • Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 ;  
  • The Employees’ State Insurance Act, 1948.
     

(In the case of labour laws, no inspections will be conducted for a period of 5 years. start-ups may be inspected only on receipt of credible and verifiable complaint of violation, filed in writing and approved by at least one level senior to the inspecting officer.)

2.  A start-up is permitted to self-certify compliance for 3 environmental laws as follows:

  • The Water (Prevention & Control of Pollution) Act, 1974;
  • The Water (Prevention & Control of Pollution) Cess (Amendment) Act, 2003;
  • The Air (Prevention & Control of Pollution) Act, 1981.
     

(In the case of environment laws, start-ups which fall under the ‘white category’ (as defined by the Central Pollution Control Board (CPCB)) would be able to self-certify compliance and only random checks would be carried out in such cases.)
 

Advantages of Having Registered Under Start-Up India

  1. Financial Benefits are that the start-ups are exempted from paying Patent Cost. Eighty percent rebate is given by the government to registered start-ups and the process of patent registration is easier for them. 
     
  2. Financial Benefits are that the start-ups are exempted from paying Trademark cost. Fifty percent rebate is given by the government to registered start-ups and the process of trademark registration is easier for them & also facilitated professionals to file their applications without and professional fee. 
     
  3. Income Tax Benefits are that the government exempts them from three years of income tax after their incorporation. Income Tax on Capital Gains can be exempted if they invest money in specified funds. 
     
  4. Registration process is simplified because only one meeting is arranged to at the Start-up India Hub. 
     
  5. Start-ups get priority in acquiring government tenders. 
     
  6. The Start-up India scheme offers a plethora of opportunities to entrepreneurs to meet with various stakeholders at a particular place and time. Two start-up fests are conducted annually which are both domestic and international.
     

Frequently Asked Questions
 

What is the concept behind the establishment of Start-up India?

Start-up India is a  great initiative of the Government of India, intended to build a strong eco-system for nurturing innovation and Start-ups in the country that will drive sustainable economic growth and generate large scale employment opportunities.
 

For how long would recognition as a “Start-up” be validAn entity would discontinue to be a ‘start-up’ upon expiry of:

a.    10 years from the date of its incorporation, OR

b.    If in any of the financial years its turnover has exceeded Rs. 100 crores
 

How do I register a profile on the Start-up India Hub?

Registering the  profile of an entity on the hub is  just asimple process.

a.  On clicking the “Register” tab on the top right-hand corner of the page which you will be directed to the “mygov” platform for authentication where you will be asked to fill details such as your name, email address, etc. This will give you a one-time password for verification as well as a link to set anew password

b.  Sign in using the login credentials you created in step 1. This will direct you to the Hub where you can select and create the profile of a stakeholder which best defines your role.
 

Can a foreign company register on the Hub?

No, as for now, Start Up India only registers Indian nationals but is working on getting global companies into its network.
 

What can I do to attract investors for a start-up?

To attract and captivate investors, not only do you need a stellar product with a scalable model, but you also need visibility. Make sure that your product receives healthy engagement and adherence. You’ll need to register your start-up on start-up India and proactively seek out investors.

Make sure you are able to effectively interact your business idea to the investor and the sustainability of your business model.
 

Can an existing entity register itself as a “Start-up” on the Start-up India Portal?

Yes, as per the law an existing entity can register itself as a start-up, provided that it meets the prescribed criteria for a start-up. They will also be able to avail various tax and IPR benefits that are available to start-ups. The criteria are the same as those mentioned in the article above.

What is the difference between an incubator and an accelerator?

Accelerators "accelerate" the growth of an existing company, while incubators "incubate" disruptive ideas with the hope of building out a business model and company. So, accelerators focus on escalate a business while incubators are often more focused and concentrated on innovation.
 

Do I need to print an application form and submit the physical copy of the same to complete the process of Startup registration?

No. Phycsical copy is not required as the application has to be submitted online only.
 

What is the timelimit for obtaining certification of Inter-Ministerial Board for availing tax/ IPR benefits in case an entity already exists?

An application for a certificate from the inter-ministerial board shall be processed within a period of 10-25 working days.
 

Is there any specified format for obtaining a recommendation letter?

Yes. All requisite prescribed formats for recommendation/ support/ endorsement letters are published on Start-up India portal.
 

Conclusion

The Start-up India initiative facilitates simplification of the processes for start-ups in order to motivate them. Also, the government provides financial support to the start-ups to through setting up a corpus of Rs.10,000 crores for 4 years (Rs.2500 crore each year). From such fund, the government invests in various start-ups.

Hence, as the objective of the scheme says, it has been launched: “To reduce the regulatory burden on start-ups, thereby allowing them to focus on their core business and keep compliance costs low.” 
 

Edited by Shraddha Jha