ANJU ARUJAS3 MBA

CET14/09 /2012

COMPANIES

COMPANY

Association of individuals formed for some common purpose.

Voluntary association to carry on some business for Profit Promote art,science,education Some charitable purpose

DEFINITION

Companies Act 1956, Section 3(1)(i)

“A company formed and registered under this act, or an existing act”.

“ A Voluntary incorporated organization which is an artificial person, created by law with limited liability having a common seal and perpetual succession”.

Salient Features

Voluntary association – activities of this association are governed by the law and are limited by its own character –The Memorandum Of Association.

Incorporated association

Independent legal entity

Separate property.

Perpetual succession

Common seal

Share capital

Limited liability

Transferability of shares

Ownership and management

Classes Of Companies

Chartered companyStatutory companies

incorporationRegistered companies

Companies limited by sharesCompanies limited by guarantee

liabilityCompanies with unlimited liabilities of

members

Classes of companies

Private number of members

Public

Private company Public company

Min members-2,max -50 Min members-7,max-no limit

Min paid up capital-1 lkh Min paid up capital-5 lkhs

Public cant subscribe shares or debentures

They can

Can immediately proceed to make allotment of shares after incorporation

shall have to wait

Need not wait for min subscription Shall have to wait

After incorporation, it can immediately commence business

Have to wait till certificate for commencement of business is received.

May not hold statutory meeting Has to hold the meeting

There is restriction on transfer of shares

Freely transferred

MOA be signed by 2 members MOA should be signed by at least 7 members.

Private company to public company

Conversion by default

Conversion by choice

THANKYOU