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Contracts and Agreement, License, Uncategorized
  1. Music License: You can use a free public domain or CC 3.0 licensed music from the web, however, most of the time it’s tough to find good music suitable for your game there. You would also need to buy a license for the sound effects that have been copyrighted.
  2. Employee Contract: You will need this for hiring any full or part-time employees. Employee Contract can determine the pay schedule, when the employee will receive pay, any paid holidays, paid sick days or paid vacation days, and other various things. It helps you and your employee understand what you are offering him or her.
  3. General Contract: It is somewhat similar but can be used for contract hires and freelancers who work for you.
  4. Confidentiality Agreement: It is for anyone working with you on your game. This one is important as it states that anything created for the game is owned by your company, and not the creator. This protects your company from your employees or your contract hires from stealing your intellectual property and claiming it is their own.
  5. User Agreement: It is also known as a software license or end user license agreement?. Through this, the user agrees to the privilege of using or purchasing your software and promise to comply with all the restrictions stated in the user agreement.
  6. Privacy Policy: This is for the purpose of telling how you use any information that your users give to you, either on your website or your game/app. It also states that you will protect your users information and it publically states what information is required in order to use your service.
  7. All Rights Reserved: It tells that everything that is within your website or game/app is yours, you hold the right to use it, and unless otherwise stated people require your permission to use your stuff. It is for the purpose of protecting your stuff from theft and other claims on your stuff.
  8. Terms of Service: These are the rules you declare in order for someone to comment on your website, purchase a product from you or other services that you might offer. If someone were to break your rules, your Terms of Service would actually come into play and you can handle it accordingly.
  9. Unity License: You need to have any valid Unity license (either personal or pro) to submit your app. The license can be free one or a paid one, though pirated licenses will not work at all.
  10. Other Licenses: You also need to buy the license for the trademark stuff, like, if you want to use a specific car model in your car racing game you need to buy the license from the company, or if you want to buy a specific gun model it also requires a license.
  11. Adobe license: This one is important as you need Photoshop or Illustrator license. You can use Creative Cloud as one of the most potential solutions.
  12. Autodesk license: Autodesk license for 3D Max and/or Maya should also be taken in order to create 3D content. One can buy a monthly subscription instead of the perpetual license.
  13. Tax Registration: Indirect tax registration and Direct tax registration is something that is applicable to all businesses in India.
  14. IP protection: It’s the endearing competitive touch that you can give to your product.
  15. Funding Compliance: Raising funds involves multiple legal compliances that not just investor wants, but also you need to protect your relationship with investors.
We have been helping businesses like yours to get in touch with best lawyers and Accountants for years now, we would be glad to help you, let us know. Thanks!
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Secretarial Compliance, Uncategorized, Winding up of Company
It is better to abandon a sinking and damaged ship than to sink with it. A business may need to be closed for many reasons that may be due to business failure or any other unavoidable circumstances.

Under Companies Act 2013, a Company can be closed in two ways.

    1. Winding Up
Winding up is a tedious process and can be done either voluntary by calling up a meeting of all stakeholders and passing a special resolution or can be done on the order of Court or Tribunal. Strike Off mode was introduced by the MCA to give the opportunity to the defunct companies to get their names struck off from the Register of Companies. On 27th December 2016, MCA has notified new rules i.e. Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 prescribing rule for winding up or closure of the private limited company under companies act 2013. By releasing the form STK 2, the ministry of Corporate Affairs has brought the Section 248- 252 of 2013 act into force.

    1. Fast track Exit
This is the most awaited procedure, that got active again on 5th April 2017. This procedure was introduced in Section 248 of Companies Act 2013.
Fast Track exit can be done in two ways:
    • Suo Moto by Registrar
The registrar may strike off the name of Company on its own if:
    • Company has failed to commence any business in a year of its incorporation
    • The company is not carrying out any business or Activity for preceding 2 financial years and has not sought the status of Dormant Company.
The Registrar sends a notice (STK-1) of his intention to remove the name and seeks the representation of Company in 30 days. Note: Liability on the Directors of the company still exists. ROC can invoke penalty clauses anytime, and the penalty may range from INR 50K to INR 5Lakhs per director.
    • Voluntary Removal of Name using Form STK 2
The company can also move an application to Registrar of Companies for striking off the name by filing form STK-2 along with a fee of Rs 5000/-. Once the form is filed, the Registrar has power and duty to satisfy him that all amount due by the company for the discharge of its liabilities and obligations has been realized. ROC can also issue a show cause notice in case of default in filing returns or other obligations. After above formalities, ROC issues a public notice and strike off the name of Company after its expiry. Note: The form is in approval route. Therefore, concerned ROC can ask for the completion of the fillings.

Details Required
:
    • Incorporation Certificate
    • Director Identification Number
    • Pending Litigation Proceedings if any
Documents Required:
    • Application in form STK-2
    • Government filing fees: INR 5,000/-
    • Copy of Board resolution ?authorizing the filing of this application;
    • A statement of accounts ?showing the assets and liabilities of the Company made up to a day, not more than thirty days before the date of application and certified by a Chartered Accountant
    • The shareholder’s approval by way of Special Resolution
    • In the case of a company regulated by any other authority, approval of such authority shall also be required.
    • Copy of relevant order for delisting, if any, from the concerned Stock Exchange;
    • Indemnity bond in Form No. STK-3;
    • Affidavit in Form No. STK-4
Note: This form must be signed by a practicing CA or CS

Companies that cannot file for voluntary strike-off:

A company cannot fill the form STK 2 at any time in the previous 3 months if the company has
    1. Has changed its name or shifted its registered office from one State to another;
    2. Has made a disposal for value of property or rights held by it, immediately
    3. Before cesser of trade or otherwise carrying on of business, for the purpose of disposal for gain in the normal course of trading or otherwise carrying on of business;
    4. Has engaged in any other activity except the one which is necessary or expedient for the purpose of making an application under that section, or deciding whether to do so or concluding the affairs of the company or complying with any statutory requirement;
    5. Has made an application to the Tribunal for the sanctioning of a compromise or arrangement and the matter has not been finally concluded; or
    6. Is being wound up under Chapter XX of Companies Act or under the Insolvency and Bankruptcy code, 2016

Companies that cannot use Fast Track Exit option:
    • Companies Registered Under Section 8
    • Listed companies
    • Companies that have been delisted due to non-compliance of listing regulations or listing agreement or any other statutory laws;
    • Vanishing companies;
    • Companies where inspection or investigation is ordered and being carried out or actions on such order are yet to be taken up or were completed but prosecutions arising out of such inspection or investigation are pending in the Court;
    • Companies where notices have been issued by the Registrar or Inspector (under Section 234 of the Companies Act, 1956 (old Act) or section 206 or section 207 of the Act)and reply thereto is pending;
    • Companies against which any prosecution for an offense is pending in any court;
    • Companies whose application for compounding is pending;
    • Companies which have accepted public deposits which are either outstanding or the company is in default in repayment of the same;
    • Companies having charges which are pending for satisfaction.

After you Strike off your company:

As soon as the name of the company is removed from Register, from the date mentioned in the notice under sub-section (5) of section 248 cease to operate as a company and the Certificate of Incorporation issued to it shall be deemed to have been canceled from such date except for the purpose of realizing the amount due to the company and for the payment or discharge of the liabilities or obligations of the company.
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Uncategorized
Every business entity needs to be given some name and the functioning of the business is carried out in that name only. In the case of a company which enjoys the status of the separate legal entity, selecting a proper name is a must. Name approval from the Registrar of Companies is pre-requisite condition before incorporation of the company. Procedure for Name approval Application to concerned Registrar of Companies to ascertain the availability of name in eForm-INC1 need to be made. Maximum 6 suitable names can be submitted in order of preference and name must indicate main objects of the company. The Name itself:
  • The proposed names must not be similar or resemble the name of any other already registered company, or
  • Proposed name should not violate the provisions of emblems and names (Prevention of Improper Use Act, 1950), or
  • Proposed name(s) should not constitute an offense under any law.
  • Last word ?Limited? need to be used in the case of a public limited Company, or ?Private Limited? in the case of a private limited Company and ?LLP? needs to be used for ?Limited liability Partnerships?
Along with government fee and complete form, the digital signature of the applicant proposing the company needs to be attached. For filling this form Digital Signature of one of the Promoters is mandatory. The details need to be provided in eForm INC1 are:-
  • Authorized capital for the proposed company
  • Main objectives of the proposed company
  • State (location) of the proposed company
  • Personal details of all Promoter?s
  • Copy of trademark application/certificate (if applicable)
  • In case, there is a logo associated with trademark then image of logo
  • Balance sheet (if applicable) and Income tax returns for last 2 years
If the name is approved by Registrar of Companies, letter of acceptance is issued for the proposed name. If proposed name(s) are not available, fresh names can be applied through the same application. ?I will be glad to help you in this, let’s connect.
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Uncategorized
In Limited Liability Partnership or LLP under LLP Act 2008, where all or some of the partners have limited liability as per the shares and offers them protection from misdeeds, negligence, and incompetence of other partners. However, the liability of partners is unlimited in case of fraud committed by LLP. The LLP Agreement regulates the conduct of business. Section 56 of LLP Act 2008 provides that private companies can convert into LLP. Thus Companies are converting themselves into LLP?s because of:
  1. Tax benefits: by converting into LLP, the company saves Dividend Distribution Tax, Minimum Alternative Tax, and Income Tax because interest and remuneration is paid to partners as salary that is payable to directors.
Earlier there was no capital gains tax when existing entity converted into LLP but after the amendment of 2016, a company having assets in excess of Rs 5 crore in any of three preceding years has to pay capital gains tax.
  1. Less Statutory Compliances: compared to statutory compliances of a private limited company as per Companies Act 2013 an LLP gets relief in the form of
    • No requirement to maintain statutory record registers.
    • No requirement to pass resolutions for addition or deletion of Directors, increasing capital.
    • No such requirement to hold a Compulsory annual meeting.
    • No conditions or cap for loans except what is stated in LLP Agreement.
    • Compulsory Audit only if Turnover is above 40 lakhs.
One of the areas where the company had an upper hand over the LLP was that the LLP was not an eligible entity for claiming tax incentives (100% deduction for 3 years) offered to start-ups as provided by the draft Finance Bill, 2016. However, the Finance Act, 2016 has eliminated this disparity by extending this benefit to LLPs. Thus, where start-ups do not intend to raise funds from the public, LLP seems a good start for the initial setup. Conditions for conversion of Private Companies into Limited Liability Partnership: A company is converted into LLP by complying with the provision of Schedule 3 of LLP Act 2008 and can do so only if (a) There is no security interest in its assets subsisting or in force at the time of application; and (b) The partners of the limited liability partnership to which it converts comprise all the shareholders of the company and no one else. The procedure of conversion:
  • In order to get converted into LLP, every designated partner must possess Director Identification Number. A meeting of Board of Directors must pass a resolution for conversion of Company into LLP as well as to authorize a director to apply for the name of LLP. A copy of this resolution is to be attached with e-form LLP-1 with Registrar of Companies (ROC).
  • Once registrar issues name approval Certificate, Incorporation Documents as the address of registered office of LLP, notice of consent of Designated Partners, Details of LLP(s) or companies in which designated partner is a director are filed using E-form 2 with ROC.
  • E- Form 18 is filed with ROC for application of Conversion along with certain attachments as a statement of shareholders, assets and liabilities of the company, NOC from IT authorities and list of all secured creditor along with their consent.
  • Registrar of LLP issues a Certificate of Registration as per the provisions of this act and may refuse if not satisfied with the particulars or other information.
  • After all above formalities are complied with and approved by Ministry, LLP Agreement is to be submitted within 30 days of incorporation using E- form 3
  • Once Registration Certificate is issued, information of conversion is to be intimated to concerned Registrar of Companies with which it was registered under the provisions of Companies Act 2013 within 15 days of such conversion using E-form 14.
Should You Really Go for Conversion? In case you are a small entrepreneur and want your business to be internally driven, LLP is the best option to run your business. But the company surely provides much better opportunities for large business as evolved laws are there for bringing capital and diluting or liquidating stakes.
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Uncategorized
You would agree with me that most startups are under the categories of Micro Enterprise that is having an investment of less than Rs 25 lakhs. Considering the total share of MSME?s being 37% of the GDP, one cannot ignore the importance of this sector. Thus Government of India wants to ensure that MSME?s gets maximum benefits of the current fiscal and trade policies. However, to avail the benefit of any such existing policies, it is required that your Enterprise must be registered one. ? Prior to October 2016, to get yourself registered as MSME?s you need to carry out a lot of paperwork and fill Employment Memorandum I and II. However, Kamath Committee on Financial Structure of MSME sector recommended a single window clearance system. Hence, Policy of Udyog Aadhar came into force. What is Udyog Aadhar? Udyog Aadhar is a facility by which your company gets a 12 digit unique ID and becomes a legal entity. Any micro, small or medium enterprise to start out any business needs to get itself registered under Udyog Aadhar. Process of getting your own Udyog Aadhar Id
  1. To do registration, owner of the enterprise needs to fill a single form online or offline available at the site of ministry. This form is free of cost.
  2. The document required for the registration are Personal?Aadhar number,?Industry name, Address, bank account details, PAN number in case of Cooperatives, private or public limited and LLP and details of major activity carried out by the enterprise.
Why get your Udyog Aadhar? The government of India announces various incentives time to time to promote MSME?s through MSMED Act 2006. Once registered you get:  
  • Easy sanction of Bank loans at lower rates of interest
  • Credit Guarantee scheme
  • Excise exemption
  • Exemption under direct tax laws
  • Interest on Delayed Payments Act which is thrice of the rate stipulated by RBI for the time being
  • Other Subsidies from State Governments as extended credit facilities, Industrial extension support and services, Assistance in marketing( both within the country and outside) Assistance for construction of industries in underdeveloped areas, Technical consultancy, assistance in capital, and so on, for enhancement of technology in MSME?s
  Apart from it Government in a phase wise manner enhances the list of reserved products to be brought from MSME?s only. Moreover, as per Trademark Rules 2017, special provision has been carved out for micro and small industries. As per schedule A of the rules, the fees for filing a trademark application for MSME?s is only 50% as compared to another form of business. Understanding the nature of Your Enterprise Since for the time being, Udyog AAdhar is available to MSME?s only, it is important to understand What an MSME is. MSME standing for MICRO, SMALL and MEDIUM enterprise are divided on the basis of Investment which is different for manufacturing or service sector
Manufacturing Sector
????Enterprises?Investment in plant & machinery
????Micro Enterprises?Does not exceed 25 lakh rupees
????Small Enterprises?More than 25 lakh rupees but does not exceed five crore rupees
????Medium Enterprises?More than five crore rupees but does not exceed ten? crore rupees
Service Sector
????Enterprises?Investment in equipment
????Micro Enterprises?Does not exceed 10 lakh rupees:
????Small Enterprises?More than 10 lakh rupees but does not exceed two crore rupees
????Medium Enterprises?More than 2 crore rupees but does not exceed five crore rupees
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Uncategorized
The Government on March 6, 2017 notified a new set of trademark rules which have replaced the old rules constituted way back in the year 2002. The main idea behind the change is to help expedite the approval process and increase filings, both of which have shown positive trends over the past few months. While the examination time for an application has been brought down from 13 months to just 1 month in January 2017, official figures suggest that filings have jumped 35 per cent in 2015-16 against the previous year. Here are a few important things you should know that have changed in the new rules:
  1. Ease of doing business: One of the most important things is that the total number of forms that an applicant had to fill out has been reduced from a monumental 74 to a quite reasonable 8.
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  1. Slashing of cost: The new rules have hiked fee for Trademark application to Rs. 9,000 but application fee for individuals, start-ups and small enterprises has been kept to Rs. 4,500 only (Government fee)
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  1. Clarity in the approval process: To make a business doing easier, the method to determinate well-known trademarks has been clarified for the very first time. Provisions relating to the expedited processing of an application for registration of trademark have been extended up to the registration stage. Until now, they were only till the examination stage.
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  1. Quick disposal: Concept of video conferencing has been introduced in the new rule and the number of adjournments in opposition proceedings has been limited to two by each party, these measures are surely going to help in disposal of cases on time.
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Uncategorized
Pvt Ltd Company

For a Cofounder to withdraw salary from his Private Limited Company, there are basically 3 situations:
1. you decide to act as the employee of the company, then the way you can be paid is a salary. Here you would, like any other employee, need to enter an employment contract with the company and receive remuneration. In addition to this remuneration, based on this Employment Contract, and a specific clause for bonuses, you may be paid a bonus at either regular intervals or on the achievement of certain goals.
2. You act as a consultant; Consultancy fees are paid for your expertise in management and your time.
3. Shares are a good way of driving remuneration in the form of dividends.

Partnership firm 

The partners (co-owners) share the profit or loss. Based on each partner’s individual share of the results, a standard deduction is made to calculate the surplus. The Partners can share the surplus as their salary, Rather, the partners do pay income tax on the money withdrawn. Profits and liabilities are split evenly between partners or, if partners have differing investment percentages, per what was agreed in the initial legal partnership agreement.

LLP

Options are similar to that of Pvt Ltd Company. Dependent upon their percentage of investment, partners will receive a salary.

Sole Proprietorship

As a sole proprietor, how much money you take out of your business is entirely up to you. You are still liable for taxes and, because the government does not distinguish between you and your business, you are also liable for all business losses, liabilities and debts. You can draw everything that you are making out he company, but you will be liable for taxations on the whole amount.

One Person Company

One Person Company is a separate Legal Entity and OPC will have a separate PAN. Hence the Director of OPC can get the salary from the company. This salary is taxed under Income Tax rules for a salaried individual.

We at Wazzeer have helped quite a number of startups in Contracts and Agreement drafting for the same purpose, why not we jump on a call to discuss the details?

Let’s connect!

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