Unit - 56 : Types of Companies Section 3 of the Companies Act , 1956 defines a company as ' a company formed and registered under this act , or an existing company.'
Section 2(20) of the Companies Act , 2013 defines company as ' a company incorporated under the companies act 2013 or under any previous company law i.e. those incorporated under Section 3 of Act , 1956 shall remain within the precincts of definition of company under the new act.
Features of a Company : 1. Registration 2. Artificial Legal Person 3. Independent Corporate Personality 4. Limited Liability 5. Perpetual Succession 6. Separate Property 7. Transfer of shares 8. Common seal 9. Corporate veil
Difference Between :
COMPANY PARTNERSHIP Registration Compulsory Not Compulsory _____________________________________ No. of Members Minimum 2 For Pvt , 7 for Public 2 Maximum 200 For Pvt, 10 in Banking No Limit For Public 20 for others. _____________________________________ Legal Status Has Does not have _____________________________________ Ownership of Property Owned By Owned By Company Partners _____________________________________ Management BOD Partners _____________________________________ Perpetual Existence Has Does not have _____________________________________ Contracts Member of a Partner Company can contract cannot enter with the company into a contract _____________________________________ Liability Limited Except Unlimited for Companies with Unlimited liability _____________________________________ Types of Companies : 1. On Basis of Incorporation a. Statutory Company b. Registered Under the Companies Act, 1956
2. On Basis of Liability a. Limited By Shares b. Limited By Guarantee c. Unlimited Liability
3. On Basis of Public Interest a. Private Company b. Public Company c. Government Company d. Foreign Company e. One Person Company f. Small Company
Holding and Subsidiary Companies : The Company holds the majority of its shares are known as Holding Company and the other one is known as subsidiary .