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Business Environment and Law-Nature Of Company And Formation

Nature Of Company And Formation

   Posted On :  08.05.2018 06:25 am

A Company, in common parlance, means a group of persons associated together for the attainment of a common end, social or economic.

Nature Of Company And Formation

A Company, in common parlance, means a group of persons associated together for the attainment of a common end, social or economic.
 
The Companies Act, 1956 defines the word ‘company’ as a company formed and registered under the Act or an existing company formed and registered under any of the previous company laws (Section 3). Section 12 permits the formation of different types of companies. These may be (i) companies limited by shares, (ii) companies limited by guarantee, and (iii) unlimited companies. The vast majority of companies in India are with limited liability by shares.
 
Definition Of Company:
 
 
“A Company is a voluntary association of persons formed for some common purpose with capital divisible into parts known as shares” The common stock so 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 in a company are transferable.

 

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