Company Law and Corporate Governance

Name- Mayank Kumar

Reg No- 1923022

Following are some advantages that a business organization enjoys through incorporation under
the companies act 2013:

 Corporate Personality: An incorporated company under companies Act 2013 is a

legally recognized entity that will exist separately from its shareholders or owners. It is
different from partnership companies.

 Limited Liability: In case of the company being shut down, Companies Act provides the
members of the company that, they are solely liable to contribute to the assets and
liabilities of the company. Limited Liability is one of the major reasons for setting up an
incorporated company.

 Perpetual Succession: Incorporated company has the characteristic of perpetual

succession. In case, there is a change in members of the company, the company will be
the same entity with similar privileges. The death or exit of an investor or a group of
investors will not affect the incorporated company. It will exist indefinitely till the
company gets bankrupt.

 Transferable Shares: Under Companies Act 2013, The shares of any member in the
company is a movable property. It leads to investment in shares. It also provides liquidity
to investors. Shares can be sold anytime, they are willing to, in the open market or the
stock exchange.

 Flexibility and Autonomy: A company is independent to form its own policies and
implement them in accordance with the provisions that are mentioned under the
Companies Act 2013, Memorandum and Articles of Association.