Professional Documents
Culture Documents
Sec. 3(1)(j)
Private Public
Min No. of member to form a company is 7
2
Max. No. of member should not exceed 50 No Restriction
Right to transfer share restricted Freely transferable
Cannot accept deposits from the public Can accept public deposits (Subject
to Secs 58A, AA, AAA & B)
Need not hold a statutory meeting or file a Must do so.
statutory report
THE CORPORATE VEIL
LIFTING
UnderJudicial Interpretation
Under Express Statutory Provision
LIFTING THE CORPORATE VEIL
Under Judicial Inter
For determining the character of the Co.
For the benefit of revenue
In case of fraud or misconduct
Others
Under Express Statutory Provision
Reduction in membership
Directors with unlimited liability
Fraudulent conduct of business
Failure to return application money
Misrepresentation in the prospectus
Misdescription of name
Non payment of tax
Liability of promoters for pre-incorporation contracts
Ultra-Vires acts
Holding subsidiary company
CASE OF SKIPPER CONSTRUCTION CO. (P) LTD
The lease was to take effect a week after. On the same day Maple leaf trading
Co. subleased the mansion to the Israeli embassy for 9 years, at a rent of
Rs.8.7 lakhs p.m., with 30 months rent to be deposited at the outset, and in
court. Tejwants younger son said his parents no longer had any connection
with Tej Properties. It was his Co and he has separated from his father.
FORMATION AND INCORPORATION
OF COMPANY
The Whole process is divided into four stages
1. Promotion
2. Registration
3. Floatation
4. Commencement of Business
PROMOTION
The discovery of business opportunities and the
subsequent organization of fund, property and
managerial ability into a business concern for the
purpose of making profits there from.
- Gerstenberg
(Financial Org. & Management)
PROMOTERS
It
is a short and convenient way of designating those
who set in motion the machinery by which the Act
enables them to create an incorporated company.
- Lord Blackburn
One who undertakes to form a
company with reference to a given
project and to set it going and who
takes the necessary steps to
accomplish that purpose.
- Justice Cockburn
It is a term not of law but of
business, usefully summing up in a
single commercial word, a number of
business operations, familiar to the
commercial world by which a
company is brought into existence,
- L. J, Bowen
INCORPORATION OF COMPANY
Private company
Capital is obtained from friends and relatives by
private arrangements.
Public company
a) Public to subscribe for shares-prospectus will
have to be issued
b) Arrange capital from promoters friends and
relatives-only statement in lieu of prospectus to
be issued.
c) SEBI Guidelines
COMMENCEMENT OF BUSINESS