LLP Form 8 - A Complete Guide for 2025

Eligibility

• Must be registered under the Government of India's MSME Development Act of 2006.
• Must be a company registered under the Companies Act of the Government of India and must meet the investment restrictions in plant and machinery or equipment set forth in the Government of India's MSME Development Act 2006.
• Must be a technology incubation enterprise or a startup registered as a company and located in an incubation center or park (in this case, a certification from the incubation center or park is required).
• Must be an STP Unit that has been approved.
• The invention must be in the field of electronics or information and communication technologies.

List Of Important Documents Required

1. Scanned copy of MSME Registration Certificate (For MSME Units)
2. Scanned copy of Company Registration Certificate (For Companies)
3. Scanned copy of STP Registration (For STP Units)
4. Scanned copy of the Registration Certificate issued by a competent authority and a certification from the incubation Centre/Park (For Technology Incubation Enterprise/Startup)
5. Scanned copy of the last audited Balance Sheet
6. Copy of product brochure, if any
7. Copy of latest Annual Report, if any
8. Copy of official filing receipt (OFR) with the Indian Patent Office
9. Copy of waiver under section 39 of the Indian Patent Act (Outside India)
10. Copy of proof of the application under PCT/ Paris Convention or Direct International Filing
11. Copy of technical writeup of invention as per the format of technical writeup
12. Patent search report
13. Scanned copy of Details for transfer of e-payments as per the format
14. Scanned copy of the Declaration form duly signed and sealed as per the format
15. A statement by the auditor of the enterprise that they fulfill the criteria of investment in plant and machinery or investment in capital equipment (as the case may be) as stipulated in the MSMED Act 2006.

Application procedure for Startups

• Visit the official website http://www.ict-ipr.in/sipeit/login.
• Create a User account by logging in after filling out all the details.
• Once “Login” is created, one can apply online for the scheme by submitting the required documents.

Selection OR Acceptance of Startups

The acceptance of startups under this scheme depends on the following criteria:

• For a particular invention, there can be one application for foreign filling.
• An Indian patent attorney firm with at least five years of experience in handling international patent applications handles and processes patent applications.
• Only five applications per financial year will be considered for reimbursement from a single applicant.
• The applicant should have already filed a patent application with the complete specification for the said invention with the Indian Patent Office.
• International patent filing options include the PCT route, the Paris Convention route, or filing directly in a foreign country of the innovator's choice.

Benefits

• This scheme provides financial support for the International filing of patents at different stages, including expenses in filing and processing.
• The maximum amount reimbursed per innovation shall be Rs 15 lakhs or 50% of the total expenditures paid in filing and processing a patent application up to grant, whichever is less.
• Under the scheme, financial support is also provided to Education Institutes, Meity societies, etc., for organizing seminars & workshops on IPR awareness.

Frequently Asked Questions

Shelf Prospectus Meaning

A shelf prospectus is a document issued by companies intending to offer securities in multiple tranches over a specified period without filing a new prospectus for each offering. Governed by the Companies Act of 2013, it serves as a framework to streamline capital-raising activities while ensuring regulatory compliance.

This approach helps all types of companies save time and resources while maintaining transparency in financial disclosures.

What Is The Validity Period of Shelf Prospectus?

As per the Companies Act of 2013 and SEBI regulations, a shelf prospectus is valid for one year from the issue date. During this period, the company can make multiple security offerings without submitting a fresh prospectus.

However, an Information Memorandum must be filed for each subsequent offering to ensure updated financial and operational disclosures.

What Are The Requirements For Shelf Prospectus?

To issue a shelf prospectus, a company must fulfil specific requirements under the Companies Act, 2013:

• Eligibility Criteria: The company must be a public financial institution, a bank, or a company notified by SEBI.
  
• SEBI Approval: Approval from the Securities and Exchange Board of India (SEBI) is mandatory before issuance.
  
• Financial Disclosures: The prospectus must include audited financial statements, business details, and risk factors.
  
• Regulatory Compliance: The company must adhere to statutory provisions and filing requirements.
  

Who Can Issue Shelf Prospectus?

Not all companies are eligible to issue a shelf prospectus. As per SEBI regulations, only specific entities can do so, including:

• Public Financial Institutions such as banks and NBFCs.
  
• Scheduled Banks that meet regulatory criteria.
  
• Other Companies notified by SEBI, provided they meet compliance standards.
  

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What Are The Eligibility Criteria For a Company to Issue a Shelf Prospectus?

To issue a shelf prospectus, a company must meet the following key eligibility criteria:

• Strong Financial Performance: A consistent and positive financial track record is essential.
  
• Regulatory Compliance: The company must have a history of timely filings and adherence to statutory norms.
  
• Market Reputation: A credible and trustworthy market presence is necessary.
  
• Clear Disclosure of Fund Utilization: The company must provide transparency regarding how the raised funds will be used.
  

5 Incredible Advantages of Shelf Prospectus

A shelf prospectus offers several benefits to companies and investors:

1. Flexibility: Companies can issue securities as needed without additional regulatory approvals.
2. Cost Efficiency: Reduces administrative and compliance costs associated with repeated filings.
3. Faster Time to Market: Companies can respond quickly to market conditions.
4. Improved Investor Relations: Provides transparency and trust through consistent financial disclosures.
5. Strategic Financial Planning: Enables better capital-raising strategies over time.

How Does an Investor Benefit from a Shelf Prospectus?

Investors gain multiple advantages from a shelf prospectus:

• Greater Transparency: A single document offers comprehensive details about the company.
• Consistent Access to Securities: Investors can participate in multiple offerings from a single prospectus.
• Time-Saving: Reduces the need to analyse multiple prospectuses for each security issuance.
• Better Investment Planning: Enables informed decision-making with consistent financial disclosures.

Difference Between Shelf Prospectus and Red Herring Prospectus?

Financial Securities and Shelf Prospectus

A shelf prospectus allows companies to issue various types of financial securities, including:

• Equity Shares: Ownership stakes in a company.
• Debentures: Debt instruments issued by companies.
• Bonds: Fixed-income securities providing periodic interest payments.

This streamlined approach reduces delays and administrative hurdles for issuing these securities over multiple tranches.

What Is an Information Memorandum?

An Information Memorandum is a document containing essential details about a company’s financials, operations, and business strategy. It is a key resource for investors, offering in-depth insights into the company's capital-raising plans.

When a company issues securities under a shelf prospectus, it must file an Information Memorandum before each offering to ensure updated and accurate disclosures.

Procedure to Fill Form PAS-2

Form PAS-2 is required to be filed as per the Companies (Prospectus and Allotment of Securities) Rules, 2014. Here’s how to fill it:

1. Company Details: Enter the name, registered office, and CIN.
2. Security Details: Specify the type and number of securities being offered.
3. Offer Details: Mention the issue price, purpose, and utilisation of funds.
4. Financial Statements: Attach recent audited financial reports.
5. Declaration: Ensure proper authorisation and sign the form.

Procedure to Upload Form PAS-2

Once Form PAS-2 is completed, follow these steps to upload it to the MCA (Ministry of Corporate Affairs) portal:

1. Prepare the Form: Ensure all required fields are filled out correctly and attach the necessary documents.
2. Log in to the MCA Portal: Use company credentials to access the e-filing section.
3. Upload the Form: Select Form PAS-2, attach supporting documents and verify details.
4. Payment of Fees: Pay the prescribed filing fee through the portal.
5. Submit and Confirm: After submission, a confirmation receipt and acknowledgement are generated.

Conclusion

For companies, a shelf prospectus eliminates the repetitive, time-consuming regulatory hurdles that come with multiple capital raises.

Instead of drafting and filing a new prospectus each time, businesses can plan their fundraising strategically, issuing securities when market conditions are favourable. This saves time, reduces administrative costs, and provides the flexibility needed to stay competitive.

For businesses, this means less paperwork, faster fundraising, and more flexibility to raise funds when needed. For investors, it provides greater transparency and clarity, helping them make better financial decisions.

By using a shelf prospectus wisely, companies can focus on growth, and investors can confidently explore opportunities—making it a win-win for everyone in the financial market.

Frequently Asked Questions

What is a Parent Company?

A parent company is a business entity that owns and controls one or more subsidiary companies. This control is usually achieved by holding a majority share (over 50%) in the subsidiary’s stock. While the parent company exercises influence over key decisions, strategy, and financial management, the subsidiaries often continue to operate independently with their own management teams.

The relationship enables the parent company to consolidate resources, reduce risks, and gain access to new markets while maintaining a diversified business structure.

Parent Company vs Holding Company

Though often used interchangeably, parent companies and holding companies serve different purposes and levels of operational involvement.

Examples of Parent Companies

Here are a few notable examples of parent companies and the subsidiaries they control:

• Alphabet Inc.
  
  • Subsidiaries: Google, YouTube, Waymo, DeepMind
    
  • Overview: Acts as the parent for Google's core businesses and experimental ventures.
    
• Unilever
  
  • Subsidiaries: Dove, Axe, Lipton, Ben & Jerry’s
    Overview: Owns and manages a diverse portfolio of consumer goods brands globally
    
• Tata Group (India)
  
  • Subsidiaries: Google, YouTube, Waymo, DeepMind
    
  • Overview: Acts as the parent for Google's core businesses and experimental ventures.
    

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Types of Parent Company

Parent companies generally fall into two primary categories:

1. Holding Company

Key features of a holding company:

• Owns majority shares in other companies.
  
• Doesn’t directly engage in operations or sales.
  
• Has control over its subsidiaries' major decisions.
  
• Used for risk management, asset protection, and tax benefits.
  

Example: Tata Sons is the holding company of the Tata Group, which doesn't directly run these businesses but controls strategy and owns majority stakes.

2. Conglomerate

A conglomerate is a large business entity that owns and operates multiple companies across unrelated industries. Unlike a typical company that focuses on a single sector, a conglomerate diversifies its operations to spread risk, tap into different markets, and create multiple revenue streams.

Key Features of a Conglomerate:

• Operates in diverse, unrelated sectors
  
• Has a parent company that controls all subsidiaries
  
• Subsidiaries often run independently, with strategic guidance from the parent company
  
• Focuses on diversification, financial strength, and cross-industry synergies
  

Example: Tata Group operates in sectors from IT to steel to hospitality.

Benefits of the Parent Company

Establishing a parent company offers numerous strategic advantages:

• Risk Diversification: Losses in one subsidiary don’t affect the entire business.
  
• Financial Stability: Enables capital allocation and access to larger funding pools.
  
• Tax Efficiency: Offers scope for tax optimisation across group entities.
  
• Centralised Strategy: Unified direction and resource sharing improve efficiency.
  
• Legal Protection: Limits liability and isolates financial risks.
  

These benefits make the parent-subsidiary model ideal for scaling operations across markets and industries.

How Do Parent Companies Work?

Parent companies function through a mix of ownership control and strategic management:

• Ownership: Typically hold a majority stake in subsidiaries.
  
• Oversight: Involved in major decisions, budgeting, reporting, and governance.
  
• Independence: Subsidiaries retain autonomy for day-to-day operations.
  
• Shared Services: Often provide HR, legal, and financial support to subsidiaries.
  

This model allows a parent company to guide subsidiaries while giving them room to innovate and grow.

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How to Become a Parent Company

Becoming a parent company typically involves gaining control over one or more other companies. This can be achieved through various methods, each offering different advantages and challenges. The most common routes include acquisitions, creating subsidiaries, or forming joint ventures.

1. Acquiring a Company: One of the fastest ways to become a parent company is by acquiring an existing business.
   
2. Creating a Subsidiary: Another way is by setting up a subsidiary company—a separate legal entity that is wholly owned and controlled by the parent. This allows the parent company to:
   
   • Enter new markets
     
   • Launch new products
     
   • Manage specific risks or intellectual property independently
     
3. Forming a Joint Venture: A joint venture involves two or more companies collaborating to create a new business entity, sharing ownership, control, and profits.
   

Conclusion

By holding majority stakes in subsidiaries, a parent company can effectively manage risk, diversify its investments, and expand its reach across different industries or regions. This structure allows parent companies to leverage resources, streamline operations, and enter new markets without starting from scratch.

From acquisitions and mergers to joint ventures and subsidiary creation, becoming a parent company opens doors to new growth opportunities and market dominance.

Frequently Asked Questions