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SPICE: Simple Proforma for incorporating company electronically

The MCA (ministry of corporate affairs) has recently introduced an E-form under the SPICE

scheme. In 2015, the major change was brought by MCA in which E-form INC-29 can be

filed as against 5 forms for registration of company with MOA and AOA. Five forms were as

follows;

1. DIR-3 for obtaining director identification number

2. INC-1 for approving the name of company

3. INC-7 for registration of company with MOA and AOA

4. INC-22 for registration office

5. DIR-12 for first directors of company

This change brought the incorporation of a company more easily and it took only 48 hours for

the approval.

NOW, MCA has introduced E form INC-32 to provide more facilities than the form INC-29

by introducing filing of the memorandum and articles of association electronically. It will

make lots of work easier for the professionals. Companies which can be formed under this

form are part -1 company, Producer Company, section-8 Company, private limited company

and public limited company. So now form INC-29 has been replaced with SPICE form INC-

32. INC-29 has been completely removed from the MCA portal. Themotive of both the forms

was same that were to help the fast track incorporation of a company in India.

Form INC-32 can help incorporate a company quickly in India by integrating many of the

steps into a single process.The digital signature of a professional (Chartered Accountant/

Company Secretary/ Cost Accountant/ Advocate) is required to file Form INC-32. The

professional must declare that all information presented in the form is correct and enter

his/her membership number and certificate number.

The documents required under form INC-32 are:

1. Memorandum of Association – Applicable and mandatory only in case of Section 8 company or company with foreign subscribers not having DIN.
2. Articles of Association – Applicable and mandatory only in case of Section 8 company or company with foreign subscribers not having DIN.
3. Affidavit and declaration by first subscriber(s) and director(s) – Mandatory in all cases.
4. Proof of office address:
5. Copies of utility bills that are not older than two months:
6. Copy of approval in case the proposed name contains any word(s) or expression(s) which requires approval from central government:
7. If the proposed name is based on a registered trademark or is subject matter of an application pending for registration under the Trade Marks Act, then it is mandatory to attach the trademark registration certificate or trademark application copy:
8. NOC from the sole proprietor/partners/other associates/existing company:
9. Proof of identity and residential address of the subscribers:
10. Proof of identity and residential address of directors:

Highlights of SPICE form INC-32

1. This form can be filed even after INC-1 means even if we have already applied E-form INC-1, then also we can file INC-32. This facility was not there in E-Form INC-29. Although just like INC-29, we can also apply name of the company through form INC-32.
2. MOA and AOA have been provided electronically in E-Form INC-33 and E-Form INC-34: Now under SPICe, Memorandum and Articles of Association need to be filed electronically, which will make lots of work easier. As in E-form INC-33, we just have to copy paste the objects of the company and in E-Form INC-34 which provides predrafted clauses of Articles of Association. We just have to choose the clauses to be mentioned in the Articles and also choose if any clause is not applicable or need to be altered. Hence, the task of drafting memorandum and Article of Association has become much easier for professionals.
3. Digital Signatures of subscribers and witness of MOA and AOA will be affixed: Because of new electronic Memorandum and Article of Association of the company, there is no need of signatures of subscribers and witness. That means we just need to affix digital signatures of subscribers and witness on the E-Form INC-33 and E-form INC-34.
4. Information in form INC-32 has been increased in comparison to INC-29: That means details in INC-32 is much more than INC-29 but at the same time INC-32 is quite similar with INC-29. That means just like INC-29 which fulfil five purposes for company registration, which are application for DIN allotment, reservation of name, incorporation and even PAN and TAN, INC-32 provides same facility with further facilitating the process by introducing filing of Memorandum and Article of Association of the company electronically.
5. PAN/TAN are mandatorily required to be applied while filing SPICE (Form INC 32) for incorporating company.

STEPS FOR APPLYING PAN/TAN AFTER FILING SPICE FORM (FORM INC-32)

FOR INCORPORATION OF COMPANY

• Step 1: The user shall be required to visit the MCA portal and access the service ‘Submit

application for PAN and TAN’,

• Step 2: Download 49A (PAN) and 49B(TAN) and upload them on the same screen after

attaching DSC.

• Step 3: Upload these forms (PAN&TAN) within 2 days of filing the SPICe form failing

which the entire SPICe form would be marked as Invalid and not to be taken on record.

Advantages of SPICE system:

1. E- MOA and E-AOA
2. No need to reserve Companies Name prior to Incorporation. Even if companies have applied for name in INC-1, at point No. 5(a)(i) of INC-32 where it has been asked whether approval of name in form INC-1 has been taken, fill NO (this option was not available in INC-29). But it is advisable to file INC-1 first as only one name can be proposed in this form also (same as INC-29).
3. In form INC-34, select the table applicable to you i.e. which table of AOA is applicable on you. Clauses will appear on the screen. The same can be altered or marked “Not Applicable”.

Disadvantages of SPICE system:

1. The biggest disadvantage in SPICE system is that the maximum number of subscribers can be seven only. In case of more subscribers, normal incorporation procedure has to be followed.
2. Only one name of the company can be proposed.
3. It is a bit costlier as DSC of all subscribers and witness is needed.

Conclusion:

SPICe Form INC-32 is surely an improvised version of e Form-29 wherein a lot of changes

have been made to accommodate the interest of the stakeholders by reducing the timelines,

however due to some limitations it might not be feasible when compared to earlier procedure.

We can only hope that the regulators might address the inherent limitations that are being

observed in the current procedure for incorporation through SPICe Form INC-32 (like;

limited number of subscribers, affixing of DSC of subscribers) and make the necessary

changes in the time to come so that stakeholders might be more benefited.

Compiled & Drafted By: Tanisha Agarwal