The shares of a public limited company are freely transferable and can be purchased and sold
through the stock exchanges. A shareholder of a public limited company can transfer his shares without the consent of other shareholders. But there are certain restrictions on transferabilityof shares in case of private limited company.
Since a company is an artificial person, it cannot put its signature onany document. Therefore, it is statutory for every company to have aseal on which the name of the company is engraved. Affixing of seal onany document signifies the signature of the company. Of course twodirectors have to sign as witnesses in such .cases.
Separation of ownership from management
The shareholders are the owners of the company. They areheterogeneous group of people who are widely scattered throughout thecountry and abroad. The shareholders elect their representatives calleddirectors to manage the company. Thus, the company is managed bydirectors rather than the shareholders. This results in separation of ownership from management.
The company enjoys a continuous existence. Its existence is notaffected by death, lunacy or insolvency of its shareholders or directorsas the case in partnership or sole proprietorship. The company can only be dissolved by the operation of law.
A joint stock company raises its funds through issue of shares togeneral public. Due to the small denomination of the shares, thecompany provides investment opportunities to all sections of peoplewho want to put their surplus money in the company's share.