INDIAN COMPANIES ACT A BASIC INTRODUCTION; TYPES OF COMPANIES AND THEIR BRIEF DESCRIPTION AND THEIR MAIN CHARACTERISTICS; STRUCTURAL CHANGES IN THE COMPANIES ACT

1. INDIAN COMPANY LAW-
AN INTRODUCTION
PROF. MAHUA MUKHERJEE

2. Lord Justice Lindley
 “A company is meant an association of many
persons who contribute money or money’s
worth to a common stock and employ it in some
trade or business, and who share the profit
and loss (as the case may be) arising there
from. The common stock contributed is
denoted in money and is the capital of the
company. The persons who contribute it, or to
whom it belongs, are members. The
proportion of capital to which each member is
entitled is his share. Shares are always
transferable although the right to transfer them
is often more or less restricted”.

3.  As per SECTION 2 (20) a company means
“a company incorporated under this Act or
under any previous company
law”.(COMPANIES ACT 2013)
 A company after registration becomes a body
corporate , and as a body corporate it has a
separate legal status or separate entity. This
principle is endorsed by the judgement of the
case SALOMON versus SALOMON AND
CO. LTD. The points to be noted from the
case are as follows:-
 THE CO. HAS A SEPARATE LEGAL ENTITY WHICH IS
DISTICT FROM THE PERSONS WHO COMPOSE IT.
 THE CO. IS NOT AN AGENT OR TRUSTEE OF THE
SUBSCRIBER.

4. FEATURES OF A COMPANY
 LEGAL ENTITY
 CORPORATE PERSONALITY
 LIMITED LIABILITY
 PERPETUAL SUCCESSION
 TRANSFERABILITY OF SHARES
 COMMON SEAL
 LIFTING OR PIERCING THE CORPORATE
VEIL
 REGISTRATION OR INCORPORATION
 RESIDENTIAL STATUS AND CITIZENSHIP

5. STRUCTURAL CHANGES IN COMPANIES ACT
COMPANIES ACT 1956
SECTIONS 658
SCHEDULES XV
PART 13
COMPANIES ACT 2013
SCHEDULES VII
CHAPTERS 29
CLAUSES 470

6. TYPES OF COMPANIES
 CHARTERED COMPANIES E.g. East India Co. 1600;Co.s act not
applicable
 ASSOCIATE COMPANY As per Sec2(6) of the C/A ‘13 e.g. joint
venture co.
 COMPANY LTD. BY GUARANTEE contribute to the assets of the
co. during winding up as per Sec2(21)C/A’13
 COMPANY LTD. BY SHARES As per Sec2(22) of C/A’13 to the
amount unpaid on the shares held by them
 UNLIMITD COMPANY Sec 2(92);not popular in India,members
are called upon to mitgate liabilities without limit
 STATUTORY COMPANY Spl. Act y parliament or by state
legislation
 REGISTERED COMPANY registered with Registrar of
Companies with COC & COI
 LISTED COMPANY Sec2(52) listed on a recognised stock
exchange
 FOREIGN COMPANY Sec2(42) incorporated outside India, have
a place of biz’ here or carries biz’ here in any other manner e.g
Baxter (India) based in U.S.A

7.  GOVERNMENT COMPANY Sec 2(45) either
Central/State Govt. holds 51% of the share capital e.g.
ONGC
 ONE PERSON COMPANY Sec2(62) only one person
as the member
 NON-GOVERNMENT COMPANY totally controlled
by pvt. Individuals with no Govt. contrl
 FORMATION OF COMPANIES WITH
CHARITABLE OBJECTS Sec8
• Promotion of commerce, arts etc
• Apply its profit/othr Y in its objects
• Ltd. / pvt. Ltd.
 BODY CORPORATE Sec 2(45) co. incorporated
outside India, does not include Co-op societies &other
body corporate notified by Central Govt.
 ILLEGAL ASSOCIATIONnot >10 persons in case
of banking co.s & not more than 20 persons for non
banking biz’
 SMALL COMPANY Sec 2(85)
 DORMANT COMPANYSec 455

8. PRIVATE COMPANY Sec 2(68)
PUBLIC COMPANYSec 2(71)
COMPANY DEEMED TO BE PUBLIC
COMPANY Sec 2(71)
HOLDING COMPANY Sec 2(46)
SUBSIDIARY COMPANY Sec 2(87)