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LECTURE -1

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÷ Sole Proprietorship

÷ Partnership

÷ Private Limited Company

÷ Public Limited Company

÷ Charitable Organization
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Úo registration required

Unlimited liability

Used for small business or by Professionals

Úo Separate Legal Entity
   

p Section 11 of Companies Act, 1956
  
   
  

p Mndian Partnership Act, 1932
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p Unlimited Liability

p Registration not Compulsory
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p overning Act ± Companies Act, 1956

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uESCRMPTMOÚS PRM ATE COMPAÚ PUBLMC COMPAÚ

uefinition Which by its article restricts: Which is not * private
Úumbers of members to 50
Transfer of shares
Mnvitation of public to subscribe
its debenture, shares etc.
Acceptance of deposits from
person other than its shareholders
and directors

overning Laws Companies Act, 1956 Companies Act, 1956
SEBM Act, 1992 and allied
laws.
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uESCRMPTMOÚS PRM ATE COMPAÚ PUBLMC COMPAÚ

Mncorporation 22 to 3 weeks 2 to 3 weeks
Time
Minimum Úo. of 2 (Two) 7 (Seven)
Shareholders
Maximum Úo. of 50 (Fifty) Úo limit
shareholders
Minimum Paid up MÚR 1,00,000/- MÚR 5,00,000/-
Capital
Transferability of Restricted Freely. Mf company is listed
Shares then through stock
exchange(s)
Minimum Úo. of 2 3
uirectors
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uESCRMPTMOÚS PRM ATE COMPAÚ PUBLMC COMPAÚ

Whether a es
Foreigner can es
be uirector
Whole Time Appointment not Appointment :
uirector (WTu) / compulsory and Úot compulsory, Mf
Managing Úo restriction on paid up capital < Rs. 5 Cr.
uirector (WTMu): appointment Compulsory. Mf
paid up capital => Rs.5 Crs
Appointment

WTu / WTMu: Úo restriction As per schedule XMMM,
Remuneration otherwise permission of
Central overnment.
Foreigner as Úo restriction With the approval of
WTM u / WTu Central overnment
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uESCRMPTMOÚS PRM ATE COMPAÚ PUBLMC COMPAÚ

Loan to es With the previous
uirector etc. approval of Central
overnment

Contracts with es With the consent of Board,
uirector etc. Mf paid up capital of the
company is (One) 1 Cr. or
more, approval of Central
ovt. is necessary

Loan, Mnvestment Úo restriction Some restrictions
& uarantee by
the company
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- Trust

- Society

- Section 25 Company
It can do business and earn any amount of profits, but the
distribution of profits cannot be made to Shareholders / trustee
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