The startup should be incorporated as a private limited company, a registered partnership firm, or a limited liability partnership (LLP) in India. The entity should not be more than ten years old from its date of incorporation.
1. Merger/ Demerger/ Acquisition/ Amalgamation/ Absorption:
Entities formed due to compromise/ arrangement as provided under the Companies Act, 2013 will not be recognized as Startup
3. Conversion:
Conversion of an entity from one form to another shall not be a bar for availing recognition subject to the fulfilment of condition provided in sub-section (3) of section 80-IAC of the Income- tax Act, 1961.
4. Holding including foreign holding, Subsidiary including foreign subsidiary, Joint Ventures, entities incorporated outside territory Indian Territory:5. Name Change:
Changes in the name of a recognized Startup necessitated under the relevant provisions of the applicable Act will be permitted. The benefits will be applicable starting from the original date of incorporation/registration or commencement of business by the original entity, whichever is earlier.
6. CIN/LLPIN Change:
Changes necessitated in CIN/LLPIN due to (a) change in domicile State, or (b) due to conversion as in para-3 above, (c) change in industry/ sector subject to cancellation of existing certificate, shall be permitted subject to approval obtained as per the relevant act. The benefits will be applicable starting from the original date of incorporation/registration or commencement of business by the original entity, whichever is earlier.
Changes in CIN/LLPIN for any other reasons will not be permitted.
7. Incorporating additional entities:
Incorporating additional entities having similar address with same production line/services and at least one common director/ designated partner/partner will not be recognized as startup.
8. Common directorship/partnership:
Entities operating in domains specifically prohibited by law shall not be recognized.
10. Sole Proprietorship:
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The guidelines for recognition of startups under the DPIIT play a vital role in fostering innovation, encouraging entrepreneurship, and promoting economic growth in India. By simplifying regulatory processes, offering tax exemptions, and providing access to various government initiatives, these guidelines create an enabling environment for startups to flourish. Through these measures, the DPIIT aims to drive the creation of a vibrant and robust startup ecosystem that contributes significantly to the nation's progress.