bcom 2nd year company meaning and definition

Meaning and type of company 

Meaning and Kinds of Company

The meaning of company 

bcom 2nd year company meaning

Mass production started after the Industrial Revolution. The need for skilled management and large amount of capital was felt to run large scale industries, which was neither possible by a single businessman nor by a partnership organization. Therefore, the form of business that took birth in this situation is called a company. 

In simple terms, a union of persons formed to fulfill a common purpose is called a company. When this association is registered under the Companies Act, it becomes an artificial person created by legislation with uninterrupted succession and sovereignty. 

Company definition 

Definition of Company

Definition- For the convenience of the study, we can divide the company definitions into three parts. 

(A) Statutory definitions 

(B) Judicial definitions 

(C) Theoretical

Statutory definitions

According to Section 2 (20) of the Companies Act, 2013 – “Company” means a company formed and registered under this Act or an existing company. An existing company is one “which has been formed and registered under any Companies Act prior to this Act.” Judicial definitions 

Judge James- “A union of persons organized for a general purpose is a company.” 

According to US Chief Justice Marshall – The corporation (a company with joint capital) is an invisible and intangible artificial person that exists only in the eyes of the law. ” Theoretical definitions. LH Hanne – “An artificial person created by company legislation, who has a separate and permanent existence and who has a universal currency.”

Field house “Joint capital company is a committee of persons formed to carry out any business or undertaking.” Kimbal and Kimbal- “A corporation or company is by nature an artificial person who has been created or authorized by legislation for a specific purpose.” After analyzing the above definitions, in short we can say that 

“Company is a person created by law, whose separate existence; There is continuous succession and universal dispensation. Which is constructed with a specific purpose. And the responsibility of whose members is generally limited. 

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Nature and characteristics of the company (characteristics) 

Nature and Characteristics of a Company

Artifical Man

According to the Companies Act 2013, the company is an artificial person created by Kanan but its functions are mostly similar to that of a natural human being. There is no meat in the company like a real person. Therefore, it has been given the name of agricultural person. 

Prepetual Existence

The company exists. Therefore, the death of shareholders or the meaning and type of individual bankrupt company / 3 or separation from the company has no effect on the existence of the company. 

Separate Legal Entity –

The existence of a company is different from its members. Hence, the company can enter into any kind of contract with its shareholders. A company can file a suit against its non-shareholders and a shareholder company. Thus, no shareholder is responsible for the affairs of the company, even if he has taken all the shares of that company. 

Limited Liability –

Members of a joint stock company have a limited liability, that is, each shareholder’s liability is limited to the value of the shares purchased by him. 

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Right to Sue –

The company has the right to file suit in its own name as per the law. 

Common Seal

The company cannot sign because it is an artificial person, but every document issued by the company has its universal currency. That is why its form is combined.

Joint Capital

The capital received by the shareholders under the company is jointly levied. That is why its form is combined. 

Limited Scope of Activities

The objectives of the company are given in the Council of Memorandum and the objectives

Rules related to supply and operation are given in the company’s Council of Articles. Therefore, the company works only within the limits of its Council of Contents, it cannot do any work beyond these.

Transfer to the next ( Transfer Of Shares) –

Generally any shareholder can transfer his shares voluntarily at any time, he does not need to take the permission of the company to do so. 

Winding-up of a Company –

Just as a company is born by amalgamation described in the Act, similarly it can also be ended by the winding up methods described in the Act. 

Shareholders are not Agents

The shareholders of the company cannot act as agents of the company. 

Number of Members

The minimum number of members in a public company cannot exceed seven and the maximum number of shares issued. Whereas in a private company the minimum number of members is two and the maximum number of members is 200. 

Company not a citizen – As per Section 19 of the Indian legislation, the company is not a citizen. It does not have the same fundamental rights as a citizen. Therefore, the company cannot file a suit for its fundamental rights. 

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Private company

Meaning of Private Company

As per section 2 (68) of the Indian Companies Act 2013, a private company means a company which is owned by its interiors 

(i) Restricts the right to transfer its shares.

(ii) Limits the number of its members to 200.

(iii) Prohibits the invitation of the public to purchase shares or debentures of the company. It is compulsory for a private company to have at least two members and to write the word Private Limited at the end of its name. Privileges and Exemptions of Private Co.) – In the Companies Act 2013, a private company has certain exceptions to a public company in special conditions which are called privileges of a private company. We can divide these privileges into two parts 

• Privileges or exemptions granted to all private companies.

(Ii) Privileges granted to an independent private company (which is not a subsidiary of a public company). 

All private company privileges

(Privileges available to all private companies)

(1) Number of Members –

The minimum member number of a private company is only 2. 

(2) the next allocation (Allotement Of Shares) –

The private company can start allotment of shares before the minimum subscription amount is received. That is, there is no restriction on the allocation of shares in a private company. 

(3 ) Prospectus –

A private company may allocate shares without filing a statement or stat emetnt in liew of prospectus. 

(4) Issue of new shares (Further issue of shares) –

The provisions of section 81 which are about issue of new shares do not apply to private company. 

(5 ) Commencement of business –

A private company can commence business immediately after obtaining a certificate of amalgamation. 

(6 ) Financing (Financial Assistance) –

A private company can provide financial assistance to anyone to buy shares of his or her own holding company. 

( 7) Legislative Assembly (Statutory Meeting) –

The private company is not required to call a statutory body or file a statutory report. 

( 8) Number of operators (Number Of Directors) – –

It is not necessary for a private company to have more than 2 operators.

( 9) election of demand (Demand For Poll )

If less than seven people are present in person (personaly present) then any member or proxy can ask for election on any proposal. If this count is more than 7, then two such people can demand election. 

(10) Rules regarding directors –

All prohibitions are not applicable to the operators of a private company, filing of acceptance related to working as an operator, purchasing merit shares, voting against contracts where they have their own interests. Two or more directors may also be appointed by the same resolution. The Central Government does not have to take permission to appoint a director in excess of the limits given in the Articles. 

( 11) Managerial Remuneration –

The maximum limit of percentage of managerial remuneration in a private company ie 11% is not applicable. 

Special Privileges of an Independent private company

A private company which is not a subsidiary of a public company has the following privileges –

(1) The private company may provide financial assistance to purchase or subscribe its shares. 

(2) In relation to its general assembly, information, quorum, chairman, proxy, voting and election, a private company may make provisions in its articles, then the provisions of the Companies Act do not apply thereon. 

(3) The provisions of managerial remuneration do not apply in private company.

(4) Any institution, firm or association can take office. 

(5) A private company has the following privileges and omissions in respect of privileges and missed-operators related to operators and managers; Operators of a private company are required to retire in turn. 

(i) A private company does not have to seek the consent of the Central Government to increase the number of its operators. 

(iii) No separate proposal is required in the private company for appointment of each operator. Two or more operators may be appointed by the same resolution. 

(iv) Restrictions on appointment of operators do not apply to a private company.

(v) A private company can give loans etc. to its operators. (vi) There is no restriction on the rights of the Board of Directors of a private company. 

(vii) If there is such a contract with a private company. In which the operators have an interest, then those operators can participate in the negotiations related to this arrangement and can also vote. 

(viii) Consent of the Central Government is not required to increase the remuneration of the operators of a private company. 

(ix) A private company may appoint a person who is already a managing director or manager of more than one company, like a managing director. 

(7) Restrictions on lending to other companies do not apply to these companies. 

It is due to these privileges that a private company is called amalgamated partnership. It has both benefits – confidentiality like partnership and eternal existence of a company. If the private company violates the conditions imposed by the Articles, then its privileges are taken away.

A public company considered a public company – does not have rights over the above mentioned privileges. Similarly, a private company, which is a subsidiary of a public company, also does not get all these privileges. 

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Public company means 

Meaning of Public Company

According to Section 2 ( 71) of the Companies Act 2013, “a public company is a company which is not a private company.” Although this definition does not explain the nature of private company, it makes sense that the restrictions on public company do not apply to private company. Thus the following provisions are contained in the articles of public company. 

(1) There is no restriction on the minimum member number 7 and the maximum number of members.

(2) Easy transfer of shares. 

(3) Approval to issue shares and debentures to the public.

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(I) Transformation of a private company into a public company 

(Conversion of a Private Company into a Public Company)

A private company is a public company in the following three cases

May change in

(1) change by default

(2) change by legal process

(3) Change from our will We will study here the “change from our desire” method. 

Note- The study of change methods by default and changes in legal process will be done under the heading “Private company to be treated as public company”. 

Optional change

(Conversion by Choice)

If a private company wants to convert itself into a public company, then it has to adopt the following method under section 243 of the Companies Act 2013 

(1) To Change the Articles of Association.

-If a private company changes its Council of Contents, removes the restrictions that are related to the number of share transfers and share subscription. So such private company will be considered as public company from the date of passing the resolution in this regard. 

(2) To send the entry or substitute entry to the registrar (To File the Prospectus or Statement in Lieu of Prospectus with the Registrar) –

If a private company passes a resolution to be converted into a public company, such private company should file either a statement or a substitute statement with the registrar within 30 days of the changes made to its Council of Contents. In this entry, all the topics which are given in the first part of the Second Schedule or in the substitute details should be written in the Part IV of the Fourth Schedule. 

(3) To change the name and register sentence (To change the Name and Capital Clause) –

For this purpose, a meeting will be called on 21 days notice to the shareholders. A special resolution has to be passed by 3/4 majority of the shareholders present to change the name sentence ie by removing the word ‘private’ and adding the word limited in its place. A simple resolution will be passed for the change in the register sentence i.e. the amount of capital and its various types of division and the independent transfer.

( 4) To change the number of Members & Directors.

To convert a private company into a public company, it is necessary that the company has at least 7 members and 3 operators. 

(5 ) Provision of Penalty

Failure to follow the legal system and procedure can be punished at the rate of 500 rupees per day on the company and every guilty officer of the company who commits this mistake. .

(6) Procedure –

When a private company is to be converted into a public company, the operators make a motion to do so and the Extra-Ordinary Meeting convenes to pass this resolution. The day the proposal is passed like a special resolution, from the same day the private company turns into a public company. The information has to be sent to the registrar. Such a change does not affect the statutory existence of the company.

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(II) Conversion of public company into private company 

(Conversion of Public Company into a Private Company) 

According to Section 2 (68) of the Companies Act, any public

The following method was adopted to convert the company into a private company

Should go 

(1) Changes in the articles – By special resolution in any public company, the changes in the articles can be changed to a private company.

(2) Obtaining the approval of the Central Government – No company can become a public company from a public company until the approval of the Central Government on the changes made in the Articles. 

(3) Submission of copy of the changed articles to the Registrar – When the company gets the permission of the government after the change of the articles, then within 30 days after getting this permission, a copy of the changed articles must be sent to the Registrar of Companies. Is, so that in his register he writes that company as a private company instead of a public company. If any public company fulfills the above conditions, then surely it will be converted into a private company. After this, it will be immediately necessary to reduce the number of its members to the limit prescribed for the private company and after its name it will be mandatory to write the word ‘private’. 

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Amalgamation curtain (Corporate Veil)

The rule of amalgamation (Corporate Veil) is based on the principle of independent statutory authority of the company. Accordingly, there is a veil or cover between the company and the members. Which gives the company a statutory existence separate from its members and the liabilities of the company rests with the company and not on the members. Sometimes it is necessary to know the truth of the persons working in the curtain in the name of the company by tying the curtain. Therefore, the courts at that time do not consider the company as a separate statutory authority. This change is called piercing the cover of the company or corporation. 

Exceptions to the company / corporation cover principle 

(Exceptions of the Principle of Company Corporate veil)

(1) In case of fraud or improper behavior

(2) On the theft of revenue

(3) Control of the company under the authority of foreign enemy.

(4) When the member number falls below the statutory minimum limit

(5) For not specifying the name of the company on exchange bills.

(6) In case of misrepresentation in the entry ..

(7) In case of non-refund of the application money

(8) On disclosure of full name of the company

(10) When the company acts as an agent of the shareholders

(11) In the case of being associated as a formula holder and a subsidiary company

bcom 2nd year company meaning in hindi

Illegal association 

(Illegal Association)

Illegal association means a union that is created in violation of Section 464 of the Companies Act 2013. For example, in a company association or partnership organization, which does banking business, there should not be more than 10 persons and in the case of others, more than 20 persons, that is, when a company, association or partnership institution has more than the above number, then it becomes illegal It is called a union. Effects of illegal associations – If illegal associations are formed in violation of Section 11 of the Companies Act, then it will have the following effects 

(1) This association cannot make any contract in its name. 

(2) Such a union can neither sue any outsider nor its member. Not only this, no member of such association can also submit a suit against any other member.

(3) An illegal association cannot be returned for the purposes given to it. 

(4) An illegal association has no separate statutory existence.  

(5) Under the provisions of the Act, it cannot be closed at the will of the creditor and the member.

(6) Income tax is levied on the benefits of the illegal entity and each member of the institution is responsible for paying the amount of tax. 

(7) The creditors of such institution to recover their funds

Cannot sue in court for winding up

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Excaption 

(1) This rule does not apply to an organization whose purpose is not to earn profit. 

(2) A joint Hindu family doing family business will not have this system in place. No matter how many adult members there are. 

One man company 

(One Man Company)

According to the Companies Act 2013 Section 2 (62) it is mandatory to have at least two members in a private company and at least seven members in a public company. Therefore, there is no provision of one person company under the legislation. But some clever person must meet at least two or seven as necessary to fulfill the statutory requirements. Showing members by name, they register the company and buy most of its parts themselves and give only one or two shares to the remaining members who are their own relatives. In this way, all the activities of the company are regulated and controlled. Such a company is called a one-man company. Thus it is clear that a person who has more than 50% share capital or almost all the share capital of a company is called a one-person company. In this way the person enjoys all the benefits of business with limited liability. Such companies are completely legitimate and not illegal. 

Companies Act, 2013 

(Company Act, 2013)

Integrates and modifies the law in relation to companies. The Act has 470 shards which are given in 29 chapters. There are 7 schedules with this act. 

The objectives of the Companies Act, 2013 are 1. To approve and amend the law in relation to companies 2. To provide free access to entrepreneurs in the open global market, 3. To ensure transparency and accountability in the functioning of companies, 4. Investors and stakeholders To protect the interests of. 

Administration of Companies Act, 2013 

(Administration of the Companies Act, 2013) Currently the Companies Act 2013 is administered by the following agencies  

(1) The Central Government

The Companies Act 2013 is administered by the Central Government through the Department of Company Affairs. Has the power to delegate company powers and duties to any appropriate authority. The powers related to administration of company law by the Central Government have been delegated to the authority constituted under the Companies Act.

(2) National Company Law Tribunal NCLT –

The National Company Law Tribunal has been replaced in place of the Company Law Board. The cases under consideration before the Company Law Board will now be transferred to the Tribunal. Some powers have been transferred to the Company Law Board with the Central Government and some to the National Company Law Tribunal. 

(3) Appellate Tribunal

A person aggrieved by the decision or order of the National Company Law Tribunal may appeal to the National Company Law Appellate Tribunal. An appeal can be made within 45 days of the order or decision of the National Company Law Tribunal. But on being given sufficient reasons to the Appellate Tribunal, he can accept the appeal for 45 more days. 

( 4) Registrar of Companies –

The Registrar of Companies is a public office where companies have to file forms and prospectus and these forms can be inspected by the public. 

(5 ) National Financial Reporting Authority National Financial Reporting Authority (NFRA)

The name of the National Advisory Committee on Accounting Standards constituted under the Companies Act 1956 has been changed to National Financial Reporting Authority by the Companies Act, 2013. It is a semi-governmental authority. 

( 6) pratibhati and Exchange Board of India (Securiti c s and Exchange Boardan SEBI) –

Union head of the T is formed by the participants Exchange Board for interest protection of employers (SEBI). It regulates the securities market. SEBI its duties and functions effectively play to the Central Government it quted a measure the powers of non-payment of incorporation and transfer and dividend Pratibtion in case of Nion. 

( 7 ) Official Liquidators –

There shall be a Government Liquidator for the purpose of winding up of companies by the National Company Law Tribunal. A professional team of ten government accountants, lawyers, company secretaries, cost and work accountants can be appointed. This is a regular with professionals approved by the Central Government 

The body can be. 

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Corporate companies 

(Incorporated companies)

Companies can be incorporated with the following methods 

(1 ) By State Charter (By Royal Charter) –

When there was a need to do some special work, the company was created by the government from the state mandate. The example of such a company is East India Company. These companies had more rights than the present companies. Now these types of companies are neither in England nor in India. 

(2 ) By Special Act of Parliament (By Special Act of Parliament) –

Parliament and legislatures establish companies by special act. These types of companies are set up to do business of national importance. Such companies are called statutory companies. There are many examples of such companies in India, such as State Bank and Reserve Bank of India, Life Insurance Corporation, Industrial Finance Corporation and Finance Corporation and Unit Trust of India, etc. ‘Limited’ is not written at the end of the names of these companies. 

(3 ) By Incorporation Under Companies Act

All companies in India are established under the Companies Act, except those established by special Act. There are a number of companies, which are covered under any other Act, but they are also regulated by the Companies Act, 105, such as the Banking Regulation Act for Banking Companies, Insurance Act for Insurance Companies, 1938; And Electricity (Supply) Act, 1948 has been enacted for power companies. 

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Foreign company 

(Foreign Company)

Foreign company means a company which is incorporated in a country other than India, but is doing business in India. As per section 2 (42) of the Companies Act, “foreign company” means a company incorporated outside India which (i) has established a place of business in India after April 1, 1956 or (ii) on April 1, Prior to 1956, India had established a place of business which was operational till 1 April 1956. ” Forms to be submitted by foreign companies to the Registrar. … Under the Companies Act, every foreign company that establishes its place of business in India after the enactment of the Companies Act, then to establish it. Within 30 days, the following forms have to be submitted to the registrar for registration 

(i) Certified copy of the Charter, Statutes or Councilor Seamanium and Articles of Association or any other deed relating to its constitution. A certified copy of the English translation if these forms are not in the English language. 

(ii) Full address of the registered or head office of the company. .

(iii) A list of directors and secretaries of the company, in which the full name and surname, residential address, nationality, occupation etc. should be mentioned. 

(iv) Addresses of any one or more persons residing in India who have been authorized to receive information or other documents on behalf of the company. 

(v) Complete address of the company office in India which is considered as the head office of its business in India. 

According to the Companies Act, if any change is made in any of the above forms, the company will have to inform the registrar within the specified time. A foreign company will be considered an Indian company under the following conditions 

(1) When the company does business in India and the company has a business location in India and 

(2) 51% of the paid-up capital of this company is owned by

(i) Owned by one or more citizens of India or

(ii) Owned by any one or more entities or entities incorporated in India.