WHAT IS A JOINT STOCK

COMPANY?
 A Joint Stock Company is an
artificial person having separate
legal existence, perpetual
succession and common seal.

 This Company form of organization

is considered to be most suitable
for organizing business activities
on large scale. It has advantage of
attracting huge capital from the
public.
Reliance Industries Limited
 Reliance industries was
founded 8 May 1973 by
Dhirubhai Ambani.

 It has 14 directors namely Ashok

Misra, Yogendra Trivedi, Mahesh
P. Modi, Dharamvir Kapur, Dipak
Jain, Mansingh Bhakta, Adil
Zainulbhai, R.A Mashelkar, P.K.
Kapil, P.M.S. Prasad, Nikhil R
Meswani, Hital R. Meswani, Nita
Ambani, Mukesh Ambani.

 Its shares and debentures are

available to general public .
 FEATURES OF JOINT STOCK COMPANY

Separate
Legal Artificial
Identity Person
Registration
Perpetual
Succession
Common
Seal Transferability
Of Shares
Separation of
Ownership & Limited
Control Liability
SEPARATE LEGAL
AEXISTENCE
company has a separate legal entity.
A company can carry on business, it
can buy and sell assets and it can
enter into contract with outsiders in
its own name; the company an its
individuals are separate individuals.

ARTIFICIAL
PERSON
A company doesn't have a physical
body. It is an artificial person created
by the law. Its operations are
performed by the elected
representatives of members; known
as directors.
 REGISTR
ItATION
is legally compulsory
for a company to get
itself registered under
the Companies Act,
2013. 

PERPETUAL
ASUCCESSION
company has continuous
existence independent of its
members. Only law can bring
an end to its existence. The
death, insolvency or
incapacity of any member
doesn't affect the existence of
company.
 COMMON SEAL
Being an artificial person the company
needs a common seal with its name
engraved on it. Anyone acting on
behalf of the company can use
common seal in place of signature of
the company to bind the company.

Transferability of Shares
The capital of the company is divided into
Shares. The shares of the company are freely
transferable by its members. A shareholder is
free to withdraw his membership from the
company by selling his shares. The shares of
private limited companies can't be easily
transferred.
SEPARATION OF
OWNERSHIP AND
CONTROL
The Company is owned
by shareholders. The
shareholders elect
representatives who are
called directors of the
company. The directors LIMITED
manage and control the
company. LIABILITY
The liability of members
of the company is limited
to the extent of their share
capital contribution in the
company.
 MERITS OF A JOINT STOCK
COMPANY

LIMITED
LIABILITY GROWTH
AND
TRANSFER
OF
EXPANSION
EFFICIENT
INTERESTS
MANAGEMEN
PERPETUAL T LARGE
AMOUNT
EXISTENCE OF
CAPITAL
LIMITED
LIABILITY
The liability of members
of the company is limited
to the extent of their share
capital contribution in the
company.
Transfer of
interest
The shares of the company
can be easily bought and
sold in the market. If the
owner of shares is in need
of cash, he can sell shares
PERPETUAL
EXISTENCE
Only law can bring an end to
the company's existence. The
death, insolvency or
incapacity of any member
doesn't affect the existence of
GROWTH AND
company. EXPANSION
In company there is more scope of
growth and expansion. The
company has large financial
resources and their rate of profit is
also high they can easily use large
amount of accured or retained
EFFICIENT
MANAGEMENT
A company has huge funds at
its disposal. It can easily
afford to hire professional LARGE AMOUNT
experts to perform managerial
and other activities of the OF CAPITAL
organization.
The biggest advantage of company
is that it can collect a large amount
of capital by issuing of shares to
general public. The company can
collect funds by raising loans from
financial institutions and by issue
 DISADVANTAGES OF A COMPANY

Complexity inIN
COMPLEXITY
Formation
FORMATION LACK OF
IMPERSONAL SECRECY
WORK
ENVIRONMENT NUMEROUS
REGULATIONS
DELAY IN
DECISIONS OLIGARCHIC
MANAGEMENT
CONFLICTS IN
INTERESTS
COMPLEXITY IN
FORMATION
The formation of company involves a
lengthy and complicated procedure.
Many legal formalities have to be LACK OF SECRECY
completed, many documents have to
be prepared and submitted. Various As per companies act 1956. the
permissions have to be obtained. To company is required to provide lot of
perform these activities experts are information to the office of the
hired, who charge high fees. Even registrar off companies. Such
registration fees have to be paid to the information is available to general
registrar. public also. So it is therefore difficult
to maintain complete secrecy about
the operations of company.
IMPERSONAL NUMEROUS
WORK REGULATIONS
ENVIRONMENT The company form of business
has to comply with various
Company is not managed by owners
legal formalities at different
but it is managed by the professional
stages and there is penalty if the
managers. These managers get salary
company fails to meet any of
for their services so there is no direct
the formalities. A company has
relation between the efforts and
to file return and annual reports
reward. The increase in company's
with the registrar. This legal
profit will not increase the income of
interference in day-to-day
managers. Hence there is lack of
operations results in lack of
motivation and incentive to perform
secrecy and a lot of time and
efficiently.
money is spent.
DELAY IN OLIGARCH CONFLI
DECISIONS IC CTS IN
In a company all the MANAGEM INTERES
important decisions are ENT TS
taken in the board
meeting or after Company is under the In a company
consulting  various control of a very few various groups of
persons. These people that is the people are
decisions are to be directors. The directors involved. each
communicated to every have complete control group has different
one which is  a very over the company. interests, therefore
lengthy process as a They take decisions there is a
large no. Of people keeping in mind their possibility of
work in a company at personal benefit and conflicts between
different levels. interest. various  groups.
 TYPES OF COMPANY
1. Private Ltd. Company-
Private company means a company which by its articles:

(i) Restricts the rights to transfer its shares.

(ii) Has minimum 2 and a maximum of 200 members.

(iii) Prohibits any invitation to the public to subscribe for any securities
of the company.
 SRISHTI FERRO PRODUCTS
PRIVATE LIMITED
 Srishti Ferro Products Pvt. Ltd. is a Non-government company,
incorporated on 11 Mar, 1997.

Company is registered in Kanpur (Uttar Pradesh) Registrar Office.

Company's authorized capital stands at Rs 15.0 lakhs and has 73.36%

paid-up capital which is Rs 11.0 lakhs. The company last updated its
financials on 31 Mar, 2017 as per Ministry of Corporate Affairs .Srishti
Ferro Products Pvt. Ltd. is majorly in Manufacturing (Bicycle parts &
Bicycle Pumps) business from last 24 years and currently, company
operations are active. Current board members & directors are SANDEEP
RAMAN and SANJEEV RASTOGI .
2. Public Ltd. Company.
 A public company is company which is not a private company. As per the
Companies Act, a public company is the one which:

(1) Has minimum 7 members and maximum no limit.

(ii) Has no Restriction on Transfer of securities.

(iii) Not prohibited to invite general public to subscribe its securities.

 Company Limited by Guarantee means a company having
the liability of its members limited by the memorandum to
such amount as the members may respectively undertake to
contribute to the assets of the company in the event of its
being wound up. 

 Company Limited by Shares means a company having

the liability of its members limited by the
memorandum to the amount, if any, unpaid on the
shares respectively held by them.
 NOTE:
 A Company is a subsidiary of
another company if the other
company controls the composition
of its Board of Directors, or if the
other company holds more than 50
per cent of its equity share capital. 

 Promoters can decide the minimum

paid-up share capital in case of
private and public companies as it
has not been prescribed.
 ONE PERSON
COMPANY
One Person Company: The 2013 Act introduces a new type of entity to the
existing list that is a ‘One Person Company’ (OPC). An OPC means a
company with only one person as its member.

Requirements - One Person Company

A Rule [ Section 3(1) ] provides that only a natural person who is an Indian citizen and a
resident in India shall be eligible to incorporate OPC.

• No person shall be eligible to incorporate more than one OPC or become nominee in
more than one such company.

• OPC to compulsory convert itself into public or private company in certain cases.
Where the paid up share capital of an OPC exceeds fifty lakh rupees or its average
annual turnover during the relevant period exceeds two crore rupees, it shall cease to
be entitled to continue as a One Person Company.
 PURPLEDEW FLORA
(OPC) PRIVATE
LIMITED
 Purpledew Flora (opc) Private Limited is a
Private(One Person Company) incorporated
on 18 July 2018. It is classified as Non-
government company and is registered at
Registrar of Companies, Mumbai. Its
authorized share capital is Rs. 100,000 and
its paid up capital is Rs. 100,000. It is
involved in Growing of crops; market
gardening; horticulture.

This Photo by Unknown author is licensed under CC BY-SA.

 PRIVILEGES OR BENEFITS OF PRIVATE
COMPANY OVER PUBLIC COMPANY
1. A Private company can be formed with only two members whereas at
least seven members are needed to form a public company.

2. A Private company must have at least two directors, whereas a public

company must have minimum three directors.

3. It is not compulsory for a private company to maintain index of its

members, whereas it is mandatory for public company to maintain the index.

4. A private company can issue loan to its directors without prior permission
of government, whereas public company must take permission of
government before giving loans to its directors.
5. It is not compulsory for a private company to hold a statutory
meeting and file a statutory report with the registrar, whereas it is
essential for a public company.

6. There are no restrictions on the numbers, appointment and

remuneration of directors of a private company, whereas there are
many restrictions on the appointment, number and remuneration of
directors of public company.

7. It is not necessary for a private company to issue a prospectus,

whereas it is essential for a public company.

8. Private company can commence its business after getting

certificate of registration whereas public company can start business
only after receiving the certificate for the commencement of
business.
 Difference between Private Company and Public Company
Point of Difference Private Company Public company
1. No. Of Members Minimum 2 members Minimum 7 members

Maximum 200 members Maximum no limit

2. No. of directors Minimum two directors to fill quorum. Minimum three directors are needed.

3. Invitation to general Does not invite general public to subscribe to Does invite general public to subscribe to its
public its shares, debentures and public deposits. shares, debentures. public deposits.
4. Prospectus Need not issue prospectus. It is compulsory to issue a prospectus or a
statement in lieu of prospectus.
5. Transfer of Shares Does not permit transfer of shares without Free transfer of shares is permitted.
prior permission.
6. Statutory meeting and No compulsion for holding statutory meeting It needs to hold a statutory meeting and
report and filing of statutory report. must file a statutory report.
7. Index of members No compulsion to maintain the index of Mandatory to maintain the index of
members. members.
8. Legal formalities Exempted from various legal formalities. Has to comply with many legal formalities.
THANK YOU
Dhruv Rastogi - PPT & Speaker

Kavya Agarwal – PPT & Speaker

Asavari Rastogi – Speaker

Ananya Gambhir - Speaker