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Premium member Presentation Transcript INDIAN COMPANIES ACT, 1956: 4/9/2011 1 INDIAN COMPANIES ACT, 1956 Vishal Jalalporwala & Ankit JainTHE COMPANIES ACT 1956 : 4/9/2011 2 THE COMPANIES ACT 1956 Definition Various types of companiesMeaning of the term “Company”: 4/9/2011 3 Meaning of the term “Company” Company : [ section 3(1) ] Formed & registered under the companies Act Any existing company established under any previous Act.COMPANY: 4/9/2011 4 COMPANY Company is an artificial person It is considered as a separately legal entity for the purpose of law.Various Types Of Companies: 4/9/2011 5 Various Types Of Companies There are many types of company depending upon the Difference in the objects of it.Various Types Of Companies: 4/9/2011 6 Various Types Of Companies Types of Company Incorporation Liability Control Chartered Company Registered Company Statutory Company Private Limited by shares Limited By Guarantee Unlimited Company Public Private Govt. or Non. Govt. Holding & Subsidiary Foreign or Domestic PublicOn the basis of Incorporation: 4/9/2011 7 On the basis of Incorporation Chartered Company A Company incorporated under a special charter granted by the Queen of England is called “Chartered Company”. The Company is regulated by its Charter and Companies Act does not apply to this kind of company. The Charter also prescribe the nature of Business and the power of the Company. Examples : East India Company and Bank Of EnglandOn the basis of Incorporation: 4/9/2011 8 On the basis of Incorporation Statutory Company A Statutory Company is one which is created by a Special Act of Parliament or a state legislature. For achieving the purpose of public utility. The nature and the power of such companies are laid down in the special Act under which they are created. Memorandum of Association is not required. Not required to Use “limited” after its name. Examples : RBI, UTI, LIC, State Bank of India.On the basis of Incorporation: 4/9/2011 9 On the basis of Incorporation Registered Company A Registered Company is one which is registered in accordance with the provisions of the Companies Act, 1956 and includes the existing Companies formed under any other law. Comes into existence by receiving the certificate of Incorporation. Governed by the Companies Act ,1956. Registered Company may be PRIVATE OR PUBLIC COMPANY.On the basis of Incorporation: 4/9/2011 10 On the basis of Incorporation Private Company Section 3(1)(iii) : A Private Company means a company which has a minimum paid up capital of Rs. 1,00,000/- or such higher paid up capital as may be prescribed by its articles– Restrict the right to transfer its shares, if any; Limits the number of the member to fifty, Prohibits any invitation to the public to subscribe for any shares in or debenture of the company. Prohibits any invitation or acceptance of deposits from persons other than its members, directors or its relatives.Slide 11: 4/9/2011 11 Section 3(1)(iv) : Public company means a company which is Either – not a private and has a minimum paid-up capital of Rs. 5,00,000 or such higher paid-up capital as may be prescribed; Is a private company which is a subsidiary of public company. On the basis of Incorporation Public CompanyOn the basis of Incorporation: 4/9/2011 12 There is no restriction on the number of members. However, the maximum number of members depends upon the number of shares allotted. Public company may be A company limited by shares A company limited by guarantee An unlimited company. In case a public company is a limited company, then it must add the word “ Limited ” at the end of its name. It must have minimum at least 7 members. It must have at least 3 directors. On the basis of Incorporation Public CompanyOn the basis of incorporation: 4/9/2011 13 On the basis of incorporation Company not for Profit According to Section 25 , the Central Government may by license grant that an association may be registered as a company with limited liability, without using the words ‘limited’ or ‘pvt ltd’ as a part of its name. An association must satisfy the following condition; The association about to be formed as a limited company aims at the promotion of commerce, art, science, religion, charity, or any other useful objective ; It intends to apply its profits, if any, for promoting its objects; and It prohibits the payment of dividend to its members. Central Govt. has a power to revoke the license of such company.On the basis of Liability: 4/9/2011 14 On the basis of Liability Limited by shares [Section 12(2)(a)] A company limited by shares is a company in which the liability of its members is limited by its Memorandum to the amount unpaid on the shares respectively held by them. It may either public or private Company. If member of the company pays a full amount on shares then his liability would be nil. Features: The liability of its members is limited up to the amount remaining unpaid on the shares held by them. Such liability can be enforced either during the lifetime or during the winding up of the company.On the basis of Liability: 4/9/2011 15 On the basis of Liability Limited by Guarantee [Section 12(2)(b)] A company in which the liability of its members is limited by its Memorandum to such amount as the members may respectively undertake to contribute to the assets of the company in the event of its being wound up. For the purpose of Commerce, science, art, religion, charity or any other useful objects. Features: The liability of its members is limited up to the amount Guaranteed by them. Such liability can be enforced only after the commencement of winding up of the company and not during the lifetime of it.On the basis of Liability: 4/9/2011 16 On the basis of Liability Unlimited Company [Section 12(2)(c)] A company in which the liability of its members is limited by its Memorandum to such amount as the members may respectively undertake to contribute to the assets of the company in the event of its being wound up. For the purpose of Commerce, science, art, religion, charity or any other useful objects. Features: The liability of its members is limited up to the amount Guaranteed by them. Such liability can be enforced only after the commencement of winding up of the company and not during the lifetime of it.On the basis of Control: 4/9/2011 17 On the basis of Control Government Company [Section 617] A Government company means “any company in which at least 51% of the paid up share capital is held by the Central Government or by any state Government. Even a subsidiary company of Government is regarded as a government Company. Example: Indian telephone Industries, Hindustan Aeronautics Ltd.On the basis of Control: 4/9/2011 18 On the basis of Control Non - Government Company A company which may not be termed as a a government company as defined in section 617 is regarded as a non – Government company.On the basis of Control: 4/9/2011 19 On the basis of Control Foreign Company A company which is incorporated outside India under the law of that country is known as a Foreign Company. After the establishment of Business in India, the following documents must be filed with the Registrar of companies within 30 days for the date of establishment. A certified copy of the charter or statutes under which the company is incorporated The full address of the registered office of the company. A list if directors & secretary of the company. The full address of the company’s principal place of business in India.On the basis of Control: 4/9/2011 20 On the basis of Control Domestic Company A company which cannot be termed as foreign company under the Provisions of the Companies Act should be regarded as a Domestic company.On the basis of Control: 4/9/2011 21 On the basis of Control Holding & subsidiary Company If one company controls over the another company, the controlling company may be termed as a ‘Holding Company’ and company so controlled may be termed as ‘Subsidiary Company’. Section 4(4) of the act defines a holding Company as “ a Company shall be deemed to be the holding company of another, if that other is its subsidiary.On the basis of Control: 4/9/2011 22 On the basis of Control Public Financial Institute The Central Government by notification in the official Gazette is empowered to specify any other institution as public Financial Institutions if: It is constituted under any Central Act or is held or controlled by the Central Government. Not less than 51 percent of its paid up Capital is controlled or held by the Central Government.On the basis of Control: 4/9/2011 23 On the basis of Control Public Financial Institute Under Section 4A of the Act, following institution are deemed to be Public Financial Institutions: The Industrial Credit and Investment Corporation of India Ltd. The Industrial Financial Corporation of India. The Industrial Development Bank of India. The Life Insurance Corporation of India. The Unit Trust of India. The Infrastructure Development Finance Company Limited.On the basis of Control: 4/9/2011 24 On the basis of Control Multi national Companies A Multinational Companies is huge Organisation which – Operates in more than one country. Carries out production, marketing and research activities on international scale in those countries Attempts to maximize profit world over.THANK YOU: 4/9/2011 25 THANK YOU Presented By : Vishal J. Jalalporwala Registration No :- WRO 0267772 Ankit jain Registration No :- WRO 0260333 You do not have the permission to view this presentation. In order to view it, please contact the author of the presentation.