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Public Vs Private Company Notes

This document compares the key differences between private limited companies and public limited companies in India. [1] Private limited companies have a maximum of 200 members, shares that are not freely transferable, and prohibitions on public subscription and issuing prospectuses. [2] Public limited companies have an unlimited number of members, freely transferable shares that can be traded on a stock exchange, and can invite public subscription and issue prospectuses. [3] Some other differences include requirements for minimum paid up capital for public companies, directors retiring by rotation in public companies, and different quorum requirements for meetings.

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107 views

Public Vs Private Company Notes

This document compares the key differences between private limited companies and public limited companies in India. [1] Private limited companies have a maximum of 200 members, shares that are not freely transferable, and prohibitions on public subscription and issuing prospectuses. [2] Public limited companies have an unlimited number of members, freely transferable shares that can be traded on a stock exchange, and can invite public subscription and issue prospectuses. [3] Some other differences include requirements for minimum paid up capital for public companies, directors retiring by rotation in public companies, and different quorum requirements for meetings.

Uploaded by

Bilal akbar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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BASIS FOR PRIVATE LIMITED PUBLIC LIMITED

COMPARISON COMPANY COMPANY

Meaning Private Limited Company refers Public Limited Company


to the company which is not implies a company that is listed
listed on a stock exchange and on a recognized stock exchange
the shares are held privately by and whose shares are traded
the members concerned. openly by the public.

Minimum number 2 7
of members

Maximum number 200, except in case of one person Unlimited


of members company

Minimum number 2 3
of directors

Articles of It must frame its own articles of It can frame its own articles of
Association association. association or adopt Table F.

Transfer of Shares The shares of a private company The shares of a public company
are not freely transferable, as are freely transferable, i.e.
there are restrictions in Articles freely traded in an open market
of Association. called a stock exchange.

Public Subscription Issue of shares or It can invite the public to subscribe


debentures to the public to its shares or debentures.
is prohibited.

Issue of prospectus Prohibited from issuing a It can issue a prospectus or it can


prospectus. also opt for private placement.
BASIS FOR PRIVATE LIMITED PUBLIC LIMITED
COMPARISON COMPANY COMPANY

Minimum amount The company can allot The company cannot allot shares


of allotment shares, without obtaining unless the minimum subscription
minimum subscription. stated in the prospectus is obtained.

Commencement of It can start a business just It requires a certificate of


Business after receiving a certificate commencement of business after it
of incorporation. is incorporated.

Appointment of Two or more directors can be One Director can be appointed by a


Director appointed by a single single resolution.
resolution.

Filing of Consent Directors need not require the Directors must file their consent to


to act as Director filing of their consent to act as act as a director, within 30 days of
a director. appointment with the Registrar.

Retirement of The directors are not 2/3rd of the total number of


Directors by required to retire by rotation. directors must retire by rotation.
rotation The directors can be
permanent.

Place of Holding AGM can be held anywhere. AGM is held at the registered office
AGM or any other place where the
registered office is situated.

Statutory Optional Compulsory


Meeting

Quorum 2 members who are personally 5 members are required to present in


present at the meeting, person when the number of
constitute a quorum, members as on the date of the
BASIS FOR PRIVATE LIMITED PUBLIC LIMITED
COMPARISON COMPANY COMPANY

irrespective of the number of meeting is 1000 or less.


members.
15 when the number of members as
on the date of the meeting is more
than 1000 but less than 5000.

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