Corporate Identification Number is the full form of CIN and is a number that is given by the Registrar of Companies, ROC to identify companies better via their number directly. Corporate Identification Number or Corporate Identity Number is a number that is provided to companies that can either be public companies, private companies, one-person companies, not for profit companies, companies owned by the government or the state, Nidhi companies etc. In short, most of the companies that are registered in India will have a Corporate Identification Number, CIN attached to them.
The reason companies and businesses need a Corporate Identification Number, CIN is because the number is used on all official documents for conducting businesses such as invoices, letterheads, annual reports and so on. CIN is also used to track all the activities of the business by the Registrar of the Office, ROC and makes the documentation of work easier for all parties involved in the process.
What is the full form of CIN and its importance?
The full form of CIN is Corporate Identification Number or Corporate Identity Number that is given by the Registrar of Office, ROC to major businesses such as private, public companies, one-person companies, not for profit and so on.
The importance of CIN can be attributed to several reasons that help in seamless conduction of the business and documentation, from both, the business side and the ROC side. Some of the major importance of CIN are:
- Tracking Aspect: Since the CIN is given by the governing body of Registrar of Companies, ROC it becomes easier for them to track the workings of the companies. ROC also gets a better idea of all the transactions that have taken place due to the CIN, making work easier for all parties involved.
- 21-Digit Code: Corporate Identification Number, CIN is a 21-digit alpha numeric number that is provided to each company. Each 21 digit code is unique to each business and hence it becomes easy to identify the primary information of businesses with just their CIN. Information such as the state of registration or the basic nature of the business, nature of incorporation can be identified via the CIN.
- Corporate Identity: Just as every individual in an organization has an ID card for better understanding and ease of processes, the same way CIN is an ID Card for businesses that help identify and separate other businesses and companies.
These are some of the important factors due to which every company or business does need a Corporate Identification Number, without which conducting business will be difficult not only for the business but also for the governing bodies. A corporate identification number, CIN also makes the governing easy from the Registrar of Office, ROC point of view.
How are the 21 digit alpha numeric numbers decided and what is their meaning?
Corporate Identification Number, CIN is a 21 digit unique alpha numeric number that is given to all businesses and companies. Each number given is unique and is never repeated. The 21 digits in the number have some relevance and give off certain primary information such as nature of business, state code, year of incorporation and so on. The way the 21 digit alpha numeric number is divided is:
- L or U: The first letter of a Corporate Identification Number, CIN would be either the letter L or U. This is to represent whether the company is listed or unlisted. By list, the meaning is whether the company is private or public. An unlisted company is represented by the letter U, while on the other hand if the company is listed then it is represented by the letter L.
- Economic Activity: Post the first letter for listed or unlisted, the next 5 alpha numeric code mentions the economic activity or nature of business for the company. This means one can recognize what industry the company will work in and what is the basic nature of their business via these 5 alpha numeric digits. This number is allotted by the Ministry of Corporate Affairs, MCA as they have codes for every nature of the business there is.
- State Code: After the nature of business for the company, the next identification of the Corporate Identification Number is the state code. This represents the state the business or company is registered in. Every state has a 2 letter identification attached to them. For example, for a business registered in the state of Maharashtra, the state code would be MH which will be a part of the CIN.
- Year of incorporation: Once the state code has been mentioned the next 4 digits in the CIN are the year the company was incorporate and registered. For example, if a company is registered in the year 2001, those numbers will be included in the CIN.
- Classification of Company: The following 3 alpha numeric digits mention the classification of the company. These digits represent whether the company is a public company, a private company, and so on.
PTC – Private Limited Company
PLC – Public Limited Company
OPC – One Person Company
And so on. These represent what is the classification of the company.
- Registration by ROC: The last 6 numbers in the Corporate Identification Number, CIN is the registration number that is given by the Registrar of Company, ROC.
This is the breakdown of the Corporate Identification Number, CIN that gives out the basic information of the company or business such as listed, unlisted, year of incorporation, economic activity and so on.
Where all is the CIN mentioned and how is it used in business?
Corporate Identification Number, CIN is an official registration number of the business and is used in many places of official documentation and for business transactions. Some of the places where a Corporate Identification Number, CIN is used is:
- Letterhead of the company
- Invoices and receipts of the company or the business
- Annual Reports of the company also in case of public annual reports
- Transactions that can be viewed by the ROC too
Changes in CIN
In case a company goes through a transition process such as unlisted to listed or change in nature of business, the corporate identification number will have changes to represent the latest information of the business or the company. This can be done via getting in touch with the Registrar of Company, ROC who is in charge of the registration of CIN.
FAQs about CIN
- What is the full form of CIN?
The full form of CIN is the Corporate Identification Number or Corporate Identity Number that is given by the Registrar of Companies, ROC.
- What is the meaning of CIN?
Corporate Identification Number, CIN is a unique identification number given to every business or company to understand the nature of the business, the transactions conducted by the business, and for ease of keeping track of all the companies out there. It is like a unique ID card given to employees of a company.
- What is the penalty for non-compliance with the CIN?
In case a company or a business does not comply with a Corporate Identification Number, CIN there is a penalty of INR 1000 per day every day till the default continues but the maximum amount for the penalty is INR 1,00,000.
- Where all is the Corporate Identification Number used?
Since the corporate identification number, CIN is an official number of the business or company, they are used at a number of places such as the letterheads and annual reports of the business. A CIN is also used for the identification of the basic information about the business such as year of incorporation, nature of business, state of registration and so on. The ROC also uses the CIN of companies to keep a watch on their transactions.
- How can one get a CIN number?
The registration process for a Corporate Identification Number, CIN is very easy and can be done online on the official website of the Ministry of Corporate Affairs, MCA. once all the documents are submitted on the website, the company will receive the CIN within a few days.