Project on Legal Environment\PTU\ABS\Heera Singh3
Generally speaking, a company means a voluntary association of personsthat has been formed and registered under the Companies Act to carry onsome definite business and to share profits/losses of such business.Most companies are usually started privately by their promoter(s).However, the promoters' capital and the borrowings from banks andfinancial institutions may not be sufficient for setting up or running thebusiness over a long term. So companies invite the public to contributetowards the equity and issue shares to individual investors. The way toinvite share capital from the public is through a 'Public Issue'. Simplystated, a public issue is an offer to the public to subscribe to the sharecapital of a company. Once this is done, the company allots shares to theapplicants as per the prescribed rules and regulations laid down by SEBI.
can invite the public to subscribe for its shares anddebentures and it also doesn¶t restrict the transfer of shares.
can¶t invite public for subscribing to any shares or debentures of the company and it also restrict the rights of its members totransfer shares..