- Company- group of ppl.

Association of traders
- 1600s- Dutch East India Co = first co. Comps at the time est by charters
- Industrial revolution- needed cos est w/o charters of the queen. Needed cos due to limited
liability- which was unlike sole proprietorship and partnership
- Characteristics: Huge cap, fluctuating ownership, limited liability, separate legal entity

MOA- relationship w rest of world. Short doc name, objects of company

AOA- relationships within Co.- internal management

- CA, 2013- S. 2(20)- definition of co.  does not provide features of company
- company as association of ppl who come together w the object (common object) to share
profit
- minimum no to est co. 2 for pvt, 7 for pub. Exception is 1-person co
- provision to establish co. for charitable object- Section 8 Cos. (S. 25 in previous Act)-
exception to profit definition

Sect 8 of Co Act, Trust Act, Society Registration Act- ways to est NGO in India

Sole Proprietorship

- No separation b/w owner and business

- Unlimited liability
- Difficult to therefore mobilise huge capital- too risky

Partnership

- Laws of agency- responsibility for acts of other partners

Features of a Company- based on article by Armour +2 others

1. Limited Liability
2. Transferability of shares
3. Delegated management- onus of management is distributed (board of directors); central
management
4. Investor ownership- more shares, more investment, more ownership control; distinct from
partnership (where can be a partner even w/o investing capital)
5. Legal personality- separate legal entity- conferred by law. Contracts, Entity shielding (prop
of co. is separate from prop of owners) etc.

These 5 features make it the most economically efficient as possible

Liability limited to amount invested @ Face value