This document discusses the formation and operation of a joint stock company. It describes the key stages in forming a company, including promotion, incorporation by registering with the Registrar of Companies, raising capital through shares, and commencing business operations. A joint stock company has a shared capital divided into shares that may be transferred, and is formed as a voluntary association for profit with limited liability of shareholders governed by a board of directors. The memorandum of association is the document that regulates a company's external activities and must be prepared upon formation.

2.  INTRODUNTION
 JOINT STOCK COMPANY
 FORMATION OF A COMPANY
- STAGE 1 PROMOTION
- STAGE 2 INCORPORATION
- STAGE 3 SUBSCRIPTIOM OF CAPITAL
- STAGE 4 COMMENCEMENT OF BUSINESS
 MEMORANDUM OF ASSOCIATION

3.  Company is a association formed for the
purpose of doing a business having a distinct
name and limited liability.
 The company is managed on behalf of the
shareholders by the Board of Directors.

4.  Joint Stock Company refers to a company having a
joint stock or capital that is divided into units of
ownership interest, such as share which may be
transferred without consent of the other
shareholders.
 According to H.L. Haney, “A Joint Stock Company
is a voluntary association of individuals for profit,
having its capital divided into transferrable shares
the ownership of which is the condition of
membership”.

5.  Stage 1 – Promotion
PROMOTION of a business refers to all those
activities that are required to be undertaken
performed to establish a new business .
 Promotion includes conceiving of ideas ,
ascertaining all basic requirements and
arranging funds to set up the business units.
This whole process is called promotion and
person who does this is called promoter.

6. STAGE 2- INCOPORATION
 A joint stock company cannot be started without
registration.
 Company comes to existence only when it is
registered with Registrar of a company.
 Steps to be followed to register a company are-
1. Approval of name
2. Filing of documents such as MOA and AOA
3. Payment of registration fees

7. STAGE 3- CAPITAL RAISING
 Incase of a private limited co. the capital is
raise from members or banks and other sources .
 In Public co. the capital is raised from public
through shares.
 To issue shares company should draft a
prospectus and get it inspected by SEBI (STOCK
EXCHANGE BOARD OF INDIA) and follow all
guidelines laid down by SEBI.

8. STAGE 4 – COMMENCEMENT OF BUSINESS
 Private ltd. Company can start its business
after registration (stage 3).
 Public co. needs a certificate called
certificate of commencement of business .
 Certificate of commencement is obtained
from registrar of co.

9.  It is a document that regulates the external
activities and must be prepared on the
formation of co.
Clauses –
a) NAME CLAUSE
b) SITUATION CLAUSE
c) OBJECT CLAUSE
d) LIABLITY CLASE
e) CAPITAL CLAUSE
f) SUBSCRIPTION CLAUSE