Joint stock company

Pawan Kumar Ray

 Meaning and defination of joint stock
company.

 Company form of business organisation is about Big business which has

separate legal personality with limited liability for his shareholder who buy
and sell their stock (shares) depending upon the performance of company.
 Joint stock company characteristics :-
1. Separate legal Personality of the company.
2. Limited liability of the shareholder.
3. Transferable Share company.
4. Investors ownership.
5. Deligated management.
 On the basis of above characteristics meaning and definition of
the company can be studied in the following manners:-
 Definition given under the Indian Companies Act 1956.
 Definition given under the Indian companies Act 2013.
 Definition given under by well known authors.
 Definition given under well known justice.
Definition given under the Indian Companies
Act 1956.

 Section 2(10)Of the Indian Companies Act 1956 company means a

company as defined in section 3.
 Section 3(1) “ company” means a company formed and registered
under this Act or an existing company as defined in clause (ii)
 Section 3(2)“ existing company” means a company formed and
register- ed under any of the previous companies laws.
 The Above noted definition do not revolve the real meaning and
characteristics of a company.
Definition given under the indian companies act
2013.

According to Section 2(20) of the 2013 Act defines the

term “company” to mean “a company incorporated
under the Companies Act 2013 or any previous company
law.”
Above definition does not reflect the perfect meaning of
the company So the Study of well known authors and
Justice is necessary.
Definition given by well known
author.
 According to “kimbal and kimbal”, A corporations (company) is
by nature and artificial person created or authorised by the legal
status of some specific purpose.
 According to “professor honey” a company is an artificial person
created by law giving a separate entity with a perprtial success on
and a common seal.
 According to “William springle”the corporation company is a
creation of the states and passes and entity distinct from the
person awing its stock in under securities.
Definition given by well-known justice.

 According to justice James define company is following words a

company is an association of person United for common object.
 Lord justice land bi has given a very good definition of the term
company by a company is meant and Association Of many person
to contribute money and money is worth to a company.
 According to “J. Marshal “of USA has a define a company a
corporation is an artificial Be and invisible intangible and existing
completence of law.
Characteristics of joint stock company

1. Voluntary association of company.

2. Limited liability.
3. Common Seal.
4. Perpetual Existence.
5. Separate legal Entity.
6. Artificial Legal Person.
7. Incoporate association.
8. Transferability of Shares.
9. Capacity to share.
10.Ownership and management of company are separate.
11. Seprate Property.
Types of company
 A company may be classified the basics of In corporation extent
liabilities of company, no. Of members and basic of ownership
extent of public partnerships and basics of nationality.
 These can focus by different types of company in the following
ways :-
1. Classification on the basics of In corporation.
2. Classification on the basics of liability.
3. On the basics of no. Of members.
Classification on the basis of
Incorporation
1. Charted company :- These are companies which are operated under special
charted granted Burger King Or Queen. this company is governed by its
characterd which defines the nature of company and at the same time
incorporated it.
2. Statutory Companies:-These are the company which are are created by
special act legislative example RBI, SBI, LIC of India.
3. Registered Company :-A registered companies are the companies which get
registered under the statute of the Companies Act. Companies are also
provided with a certificate of incorporation by the Registrar of the
Company.
Classification of on the basis of liability
 On the basis of liability company may be two types:-
 Companies with limited liability:-When the love beauty of the company is limited to the
amount and paid on the share such a company known as companies limited by the section
2(22) of Indian Company Act.
1. Limited by guarantee section 2 (21) Companies formed for non trading purposes for
example for the pronation of art, Science, culture or sports etc. are limited by its
memorandum to such amount as the members have respect undertake to contribute to asset
of the company in case the company goes into liquidity.
2. Unlimited company section 2(92) :- it means a company not having any limit on the Lovely
of its member in an unlimited company every members is liable to debits of the company or
in the case often ordinary part Membership.
On the basics of members

 Private company :- A private company is defined section 2 (68) as a company which is

A. Restricts the right to transfer shares.
B. Limits number of members (excluding present employees who are members or ex employees
and still continues to be members) .
C. Prohibits any invitation to the public to subscribe for any of its shares or debentures or
make deposits.
1. A private company is a mature of a partnership of partners with mutual confidence in each
other are its articles place positive restrictions on absolute transfer to shares.
2. One person company section 2 (62) :- One person company means a company which has
only one person as a member it shall be private company.
 Public company section 2 (71):- A public company In one
A.Which is not private company.
B.It has a minimum as may be prescribed.
C.A private company which is a subsidiary of a company which is
not private company.
 In simple words A private company which is subsidiary of a
private company will become a public company three must be at
least 3 members .
The Formation of company

 Promotion
 Incoporation
 Commentcement of business.
1. Promotion of a company :-
 A. Promotion is the very first stage in the formation of a company promotion has been defined by
professor its need for motion included for elements discovery, investigation, assembling and financing
supported professor gando.
 B. According to CW kristein berg “promotion may be defined as the discovery of business opportunities
and the subsequent organisation funds property and managerial ability into a business concern for the
purpose of making profits therefore.
For promotion following stages are included :-

1.Discovery of an idea.
2.Investigation.
3.Assembling different factors.
4.Financing of proposition.
5.Ireporation of essential documents .
6.Name of the company.
7.Prelimary contract.
Promoters

The promoter is the person who does the necessary

parlimary work incidental to the formulation of the
company.
A registered Company may act as a promoter whether a
person is not a promoter of a company in the question of
fact depending upon the role perform by him in the
fromotion of the company.
Types of promoter
1. Accidental promoter.
2. Professional promoters.
3. Financial promoters.
 Functions ofpromoters:-
1. To get idea.
2. Analysis the idea.
3. Concerned with the experts .
4. Search out.
5. Decide the name.
6. Prepare the error.
Right to promoters

Right to receive the prelimiary expenses.

Right to receive the proportional amount from the
fellows promoters.
Liabilities of promoters

Promoters are any founder of a company.

Liability of full Discover material fact.
Liability for any prelimary contract.
Liability for mis statement in prospectors.
Liability in cause of winning hours.
Incorporations of a company (Section 7):

 Incorporation or registration of the company in the second stage of the formation of the company any
Seven or more person (two or more in case of private company) Can from a company. Even 1 person
can also form a company.
 Following stage may be taken place incorporation :-
1. Filing of documents to register.
 Make documents are the following :-
1. Memorandum of a accociation.
2. Articles.
3. Statutory declaration.
4. List of directors.
5. Written consent of Directors.
6. Declaration of qualifying shares.
2. Pament of registration fees .
3. Commencement Of business :-
 According to Section 11 20015 ammendments has done for commencement.
 Producer of registration under section 396 :-
1. Filing the application form.
2. Submitting registration fees.
3. Declaration of all assets and liabilities
4. Making techniques of the company .
5. Acquring finance capabilities.
6. Name of the promoters and address of the promothers.
7. Area of companies and name and address of the other branch of the company. Name of the director.
Thank you for your
Attention
Have a great day