A proprietorship firm is the simplest and most common form of business in India, owned and operated by a single individual. It does not require a specific registration under any law, but the business can be registered through other licenses such as GST registration, MSME (Udyam) registration, Shop and Establishment license, or opening a current bank account in the firm’s name. The proprietor has full control over decision-making, enjoys all profits, but also bears unlimited liability for any losses or debts. Since it has no separate legal identity, the firm and the owner are considered the same in the eyes of the law.
Conclusion
Proprietorship firm registration is an ideal choice for small businesses and solo entrepreneurs seeking minimal compliance and complete control. While it offers ease of setup and management, it also comes with financial risks due to the lack of limited liability protection and separate legal existence.