Kinds Of Company

Presented by:

Sujit Dutta Mazumdar PGDM - II Roll No. - 57

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MEaninG oF a CoMpanY
A Company is a form of business organization in which the funds of a large number of investors are managed by a few persons for the purpose of earning profits which are shared by all the investors.

It is a collection and association of individuals for some common purpose. It is an artificial person, invisible, intangible , created by law, with a discrete legal entity, perpetual succession and a common seal.
It is derived from the Latin words- Com and Panis. Com means Together and Panis means Bread. Thus, initially Company refers to an association of persons who took their meal together.
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DEFiniTion oF CoMpanY
A company has been defined in the Companies Act,1956 as a company formed and registered under this act or an existing company. An existing company means a company formed and registered under any of the previous company law.

An association of many persons who contribute money or moneys worth to a common stock and employ it for a common purpose and who share the profit or loss arising thereupon. (By Lord Justice Lindlay)
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KINDS OF COMPANY
The classification of companies is done from the study facility point view. So, classification can be done: (A) On The Basis Of Liability: (i) Limited company (ii) Unlimited company On The Basis Of Association: (i) Public Company (ii)Private Company
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(B)

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(C) On The Basis Of Mutuality: (i) Holding company (ii) Subsidiary Company
On Others Basis: (i) Government Company (ii) Foreign Company (iii) Special Company
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(D)

UNLIMITED COMPANY

According to section 21(2)(c) of Indian companies Act, such companies , wherein the liabilities of members are not limited, are called unlimited companies.

LIMITED COMPANIES
For the debt charges of which, the liabilities of its members are limited based upon a prior assessment, is called limited company. Generally, the word limited is suffixed to the name of such company. For fulfillment of the liabilities of the members timelimit is there.

TYPES OF LIMITED COMPANY

There are two types of limited companies: (A) Company Limited By Share: This is a type of company where the liability of members is limited in the ratio of their shares. Share capital of these companies is most essential .

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(B) Company Limited By Guarantee:
It is the speciality of this type of companies, that the liability of the members of these companies is limited upto the amount assessed in his limitation, which has been accepted to pay to the company on its liquidation.

Such companies are not set up from earning profit point of view, but are meant for fulfillment of useful objects pertaining to art, donation, business, science and religion etc.
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PUBLIC COMPANY
These are the companies which
can invite the public for sale of their shares or debentures. have seven minimum members. can transfer their shares independently.
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PRIVATE COMPANY
According to the companies Act, private companies are those companies, which by their internal rules have the members upto the limit of 50.
have restriction on transfer of their shares. do not invite the public for purchase of their shares and debentures.
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SUBSIDIARY COMPANY AND HOLDING COMPANY

A company will be treated as subordinate to other company in the following circumstances according to section 4 (1) of the Indian companies Act a) That a company controls the establishment of board of conveners of other company. b) That other company holds right upon more than 50% of marked cost of the ordinary share capital of that company.
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c) That it is subordinate to such a company which is itself assisting that other company. According to companies act, a company shall be treated as formulating of other company when this other company is providing assistance to it.

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GOVERNMENT COMPANY

According to section 617 of the Indian companies Act that company is called Government company in which minimum 15% conferred share capital is held by the central or the State Government or jointly by both the Governments.

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FOREIGN COMPANY
According to section 591 of the Indian companies Act, such type of companies which are incorporated in some other company other than India but doing business at any place in India are known as foreign companies. Therefore, it is compulsory to each foreign company functioning in india that it must write the name of that country along with its name in which it has been amalgamated. It should also need to mention that whether this company is limited or unlimited.
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SPECIAL COMPANY

Companies which is incorporated, controlled or governed by a special Act.

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