Unit
unit 01
i :i Formation
inn &
th
i ni
l
Constitution of a Business
Étienne's
Company
The word company comesfrom the latinword com with or together and
Panis meal It
initially referred to an association ofpeople who ate
mealstogether Now it refers to an entity incorporated under the law
by
individualswhowish to engage in business activities It has a separate
leg
identity from its owners enjoys rights responsibilities like a normal
person
According to companies Act 2013 Section2120 a company is defined as
company incorporated under this law or any previous law
Variousfeatures a company are as follows
of
Incorporated Association undersection2120 existence after registration
Perpetual succession death retirement insolvency ofdirectors
Separateownership Management
TransferabilityofShares public freely private restricted
commonseal signdocuments
can sue or besued participate in legalp roceedings
can own property inits own name
limitedliability toextentofamount unpaid on shares
IL mn
sygiantee Separate legalEntity Salomonvs SalomoncoLtd
Artificial legalPerson needshumanagents directors toact
Varioustypes
ofcompanies are as follows
1 Onbasis
of liability
Companies limited
byshares amount unpaid
bythem
limited by guarantee paya certainamountwhenco is
Companies members woundu
, unlimited nolimit on liability liabilityceaseswhenpersonceasestobemember
liability
11 OnbasisofnoofMembers
OnePersonCo one person is solemember director
PublicCo min7manunlimited sharesfreely transferable
PrivateCo min2man200 sharetransfer restricted
111 OnbasisofAccessto capital
Listedco shareslistedon recognisedstock exchange
UnlistedCo otherthanlisted
IV Onbasisof control
holdsso
ofvotingrights
influenceoverm ajor
Holding co enercisessignificantcontrol overanotherco
f inancial
of
decisions appointment directors
subsidaryco iscontrolledbyanotherco
Associate co notasubsidary butanotherco hassignificantinfluence
V Other companies
small companies privateco withsmallpaid
upcapital turnover
Government companies ca sa or together hold 51 ofpaidup share
c apital
section 8 companies donotdistributedividends solelyforcharity art education
science sports environment purposes generallylimited
byguara
Varioussteps in theincorporation
of a Company are asfollows
1 Obtaining a Digital Signature Certificate
Just like a physicalsignature a DSC is an online signature used to
sign all efilings related to the registration of a company under the
MCAportal including spicet cMoA eAoA etc Itis alsorequired
any for
further communications with the MCA All directors shareholders are requir
to obtain a DSC It authenticates a persons identity when signing an e for
Stepsto obtain DSC
Choose certifyingauthority govtcertified toinveDSC Mudra Capricorn NSDL
sity
reservation
p
procedure
name
s picetPartB linkedForms
obtaincertificate
ofincorporation upload
LinkedMandatoryForms
Attachmentsrequired
unit 01
i :i Formation
inn &
th
i ni
l
Constitution of a Business
Étienne's
Company
The word company comesfrom the latinword com with or together and
Panis meal It
initially referred to an association ofpeople who ate
mealstogether Now it refers to an entity incorporated under the law
by
individualswhowish to engage in business activities It has a separate
leg
identity from its owners enjoys rights responsibilities like a normal
person
According to companies Act 2013 Section2120 a company is defined as
company incorporated under this law or any previous law
Variousfeatures a company are as follows
of
Incorporated Association undersection2120 existence after registration
Perpetual succession death retirement insolvency ofdirectors
Separateownership Management
TransferabilityofShares public freely private restricted
commonseal signdocuments
can sue or besued participate in legalp roceedings
can own property inits own name
limitedliability toextentofamount unpaid on shares
IL mn
sygiantee Separate legalEntity Salomonvs SalomoncoLtd
Artificial legalPerson needshumanagents directors toact
Varioustypes
ofcompanies are as follows
1 Onbasis
of liability
Companies limited
byshares amount unpaid
bythem
limited by guarantee paya certainamountwhenco is
Companies members woundu
, unlimited nolimit on liability liabilityceaseswhenpersonceasestobemember
liability
11 OnbasisofnoofMembers
OnePersonCo one person is solemember director
PublicCo min7manunlimited sharesfreely transferable
PrivateCo min2man200 sharetransfer restricted
111 OnbasisofAccessto capital
Listedco shareslistedon recognisedstock exchange
UnlistedCo otherthanlisted
IV Onbasisof control
holdsso
ofvotingrights
influenceoverm ajor
Holding co enercisessignificantcontrol overanotherco
f inancial
of
decisions appointment directors
subsidaryco iscontrolledbyanotherco
Associate co notasubsidary butanotherco hassignificantinfluence
V Other companies
small companies privateco withsmallpaid
upcapital turnover
Government companies ca sa or together hold 51 ofpaidup share
c apital
section 8 companies donotdistributedividends solelyforcharity art education
science sports environment purposes generallylimited
byguara
Varioussteps in theincorporation
of a Company are asfollows
1 Obtaining a Digital Signature Certificate
Just like a physicalsignature a DSC is an online signature used to
sign all efilings related to the registration of a company under the
MCAportal including spicet cMoA eAoA etc Itis alsorequired
any for
further communications with the MCA All directors shareholders are requir
to obtain a DSC It authenticates a persons identity when signing an e for
Stepsto obtain DSC
Choose certifyingauthority govtcertified toinveDSC Mudra Capricorn NSDL
sity
reservation
p
procedure
name
s picetPartB linkedForms
obtaincertificate
ofincorporation upload
LinkedMandatoryForms
Attachmentsrequired
