Types of Companies
Every person has a different requirement and wants a business entity that suits his needs. Some prefer partnership firms while other prefer companies. Undoubtedly companies are the best form of corporate entities and can be easily formed. To incorporate a company you need to follow the provisions laid down by Companies Act, 2013. Today we discuss here many types of Companies.
There are a variety of companies that you can register as per your need. A company is a legal person with separate legal entity. It has perpetual succession and offers limited liability to its owners or shareholders. It can accept debt and get into transactions in its own name. The incorporation process of all the companies is same barring certain exemptions.
Private Limited Company
A private limited company is one which is privately owned and has limited number of shareholders who cannot transfer their shares. To incorporate a private limited company you need to invest a minimum paid-up capital of Rs. 1lac. It requires at least two members and can have as many as 200 members. It uses Private Limited as its suffix. For instance, Valuetech Private Limited.
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Public Limited Company
A public limited company is a company that is owned by the public. It is a company that is listed on a recognized stock exchange and its shares are traded over it. It uses Limited as its title. For instance, Idea Cellular Ltd, Tata Motors Ltd. Public limited companies require minimum of 7 members for incorporation and can have unlimited members. You need a minimum paid up capital of Rs. 5lacs to start a public limited company.
One Person Company
The concept of One Person Company came into existence with effect from 1st April, 2014. It was introduced by Companies Act, 2013. One person company of OPC is formed only formed with one member, one director and one nominee. The member and director can be the same person. Thus it requires only two people to incorporate an OPC. The nominee is appointed to carry forward the business in event of death or insanity of the member. You need a minimum paid-up capital of Rs. 1lac to start an OPC.
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