A sole proprietorship is a type of unregistered business entity that is owned, managed and controlled by a proprietor. Sole proprietorships are one of the most general forms of business in India, used by most micro and small businesses operating in unorganized sectors. The proprietorship firm is very easy to start and has very minimal regulatory compliance requirements for started and operating. However, after the startup stage, proprietorship does not offer the promoter a host of benefits such as limited liability proprietorship, corporate status, separate legal entity, independent existence, transferability, perpetual existence - which are desirable features for any business. Therefore, proprietorship registration is favorable only for unorganized, small businesses that will remain small and/or have a limited period of existence.