Class notes BUSINESS LAW (MGT201)

Define Company and company in which public is substantially
interested

Company

A company is required to pay tax on every rupee of its total income at
a flat rate, without there being any exemption limit. For the purpose of
assessment of companies the understanding of the meaning of a
company and various types of companies is every essential.

Company

A company means:

 Any Indian company, or

 Anybody corporate incorporated under the law of a foreign
country, or

 Any institution, association or body which was assessable or was
assessed as a company for any assessment year upto 1970 – 71, or

 Any institution, association or body, whether incorporated or not
and whether Indian or non – Indian, which is declared by general
or special order of the Central Board of Direct Taxes to be a
company.



TYPES OF COMPANIES

Company in which the public are substantially interested

In the following cases, a company is said to be a company in which
the public are substantially interested:

 It is a company owned by the Government or the Reserve Bank of
India or in which not less than 40% shares are held by the
Government or the Reserve Bank of India or a corporation owned
by the R.B.I.; or

 It is a company which is registered under section 25 of the
companies Act, 1956; or

 It is a company, having no share capital and it is declared by order
of the Central Board of Direct Taxes to be a company in which the
public are substantially interested; or