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    Meaning & Characteristics of A Company

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    sakshi
    A company is a registered association that is an artificial legal person, with an independent legal entity separate from its shareholders. It has key characteristics such as being an incorporated association, having perpetual existence, limited liability for shareholders, and transferable shares. It differs from a partnership in that it has a separate legal identity, limited liability for members, and shares that can be freely transferred. Companies are classified based on their mode of incorporation, number of members, control structure, ownership, and nationality. The main types of companies are chartered, statutory, registered or incorporated companies.

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    Meaning & Characteristics of A Company

    Uploaded by

    sakshi
    2K views19 pages
    A company is a registered association that is an artificial legal person, with an independent legal entity separate from its shareholders. It has key characteristics such as being an incorporated association, having perpetual existence, limited liability for shareholders, and transferable shares. It differs from a partnership in that it has a separate legal identity, limited liability for members, and shares that can be freely transferred. Companies are classified based on their mode of incorporation, number of members, control structure, ownership, and nationality. The main types of companies are chartered, statutory, registered or incorporated companies.

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    A company is a registered association that is an artificial legal person, with an independent legal entity separate from its shareholders. It has key characteristics such as being an incorporated association, having perpetual existence, limited liability for shareholders, and transferable shares. It differs from a partnership in that it has a separate legal identity, limited liability for members, and shares that can be freely transferred. Companies are classified based on their mode of incorporation, number of members, control structure, ownership, and nationality. The main types of companies are chartered, statutory, registered or incorporated companies.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    2K views19 pages

    Meaning & Characteristics of A Company

    Uploaded by

    sakshi
    A company is a registered association that is an artificial legal person, with an independent legal entity separate from its shareholders. It has key characteristics such as being an incorporated association, having perpetual existence, limited liability for shareholders, and transferable shares. It differs from a partnership in that it has a separate legal identity, limited liability for members, and shares that can be freely transferred. Companies are classified based on their mode of incorporation, number of members, control structure, ownership, and nationality. The main types of companies are chartered, statutory, registered or incorporated companies.

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    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 19

    MEANING &

    CHARACTERISTICS OF
    A COMPANY

    Meaning
    A company is Registered association
    which is an artificial legal person,
    Having an independent legal entity
    with a perpetual succession, a
    common seal for its signatures, a
    common
    capital
    comprised
    of
    transferable shares and carrying
    limited liability

    Characteristics of
    Company
    1) Incorporated Association when
    it is registered under the company
    act

    2) Artificial Legal Person It exists


    in the eyes of the law and cannot
    act on its own. It has to act through
    a board of directors elected by
    shareholders

    3) Separate Legal Entity- The


    property of the company is to be
    used for the benefits of the company
    and nor for the personal benefits of
    the shareholders

    4) Perpetual Existence- Its life does


    not depend upon the death,
    insolvency or retirement of any or all
    shareholders, directors.

    5) Common Seal it acts through


    natural person who are called its
    directors.

    6) Limited Liability- limited to the


    unpaid value of particular thing

    7) Transferable Shares- The right to


    transfer shares is a statutory right
    and it cannot be taken away by
    provision in articles

    8) Separate Property It is capable


    of owing, enjoying and disposing of
    property in its own name

    Distinction b/w Company


    and Partnership
    COMPANY

    PARTNERSHIP

    1. MODE OF
    CREATION
    2. LEGAL
    STATUTE
    3. LIABILITY

    By Registration

    By agreement

    Legal entity distinct


    from members

    Firms and Partners


    are not separate

    Limited Liability of
    members

    Unlimited joint

    4. AUTHORITY

    Divorce b/w
    ownership and
    management

    Right to share
    management

    5. TRANFER OF Public CompanyFreely transferable


    SHARES

    No right to transfer
    of share by the
    partners- limited
    rights

    COMPANY

    PARTNERSHIP

    6. NUMBER OF
    MEMBERS

    Private company
    min- 2
    Max- 200
    Public company
    min- 7
    Max No limit

    Min- 2
    Max 20

    7.RESOURCES

    Large and
    Unlimited
    Resources

    Limited

    8.GENERAL
    POWERS

    Alteration Difficult

    Easy to Change

    9. LEGAL
    FORMALITIES

    Statutory books,
    Audit, Publication,
    registration filing
    etc.

    No legal Formality

    10. DISSOLUTION

    Only according to

    By agreement

    TYPES OF COMPANIES
    By Mode of Incorporation
    On the Basis of Number of
    Members
    On the Basis of Control
    On the Basis of Ownership of
    Company
    On the Basis of Nationality of
    Company

    1)Classification of companies By
    Mode of Incorporation
    I. Chartered Companies
    II. Statutory Companies
    III.Registered or Incorporated
    Companies
    Companies Limited by shares
    Companies Limited By
    Guarantee
    Unlimited companies

    Chartered Companies - These are


    incorporated under a special charter by a
    monarch. Examples- The East Indian
    Company and The Bank of England.
    Statutory Companies- These companies
    are incorporated by a special act passed
    by the central or state legislature.
    Example- Reserve bank of India, State
    Bank of India etc.
    Registered or Incorporated companies
    Companies limited by shares
    Companies limited by Guarantee
    Unlimited Companies

    2) On the Basis of Number of


    Members
    Private Company

    Public Company

    3) On the basis of
    Control
    Holding Company- if it has power
    to control over the other company.
    By holding more than 51% of its voting
    rights
    By holding more than 51% of the equity
    capital

    Subsidiary Company when its


    control is exercised by the latter.

    4)On the Basis of Ownership of


    Companies
    Government Companies A
    company of which not less than 51%
    of paid up capital is held be the
    central government or by state
    government.
    Non Government Companies except government companies

    5) On the Basis of
    Nationality
    Indian Companies registered in
    India under companies act and have
    their registered office in India.
    Foreign Companies- Incorporated
    outside India which has an
    established place of business in
    India.

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