Company law - Legal Environment of Business - Business Law - Commercial Law - Manu Melwin Joy
- 1. Company Law Legal Environment of Business
- 2. Prepared By Manu Melwin Joy Assistant Professor Ilahia School of Management Studies Kerala, India. Phone – 9744551114 Mail – [email protected] Kindly restrict the use of slides for personal purpose. Please seek permission to reproduce the same in public forms and presentations.
- 3. Introduction • Companies act 1956 came into force on 1st April, 1956. Central government is the supreme authority responsible for the administration of Companies act 1956.
- 4. Definition • A company in broad sense may mean an association of individuals formed for some common purpose. • Section 3(1) (i) of the Companies Act, 1956 states that a company means “a company formed and registered under this Act, or an existing company”. • According to A.A.Barley, “ A company is a combined political, social, economic and legal institution”.
- 5. Salient features of registered company • Voluntary Association – A company is a voluntary association of persons who have come together for a common object which generally is to earn profit. • Incorporated association – A company comes into existence on incorporation under the companies Act.
- 6. Salient features of registered company • Independent Legal Entity – A company is an artificial person created by Law. It has an independent legal entity apart from the members who constitute it. • Separate property – A company is capable of owning, enjoying and disposing of property in its own name.
- 7. Salient features of registered company • Legal restrictions – The formation, working and winding up of a company are strictly governed by laws, rules and regulations. • Perceptual succession – A company has a perceptual succession in the sense that the life of a company is not measured by the life of any member.
- 8. Salient features of registered company • Common seal - It acts as an official mark of the company. Anything done under an agreement between the company and the third party requires the recognition of the company in the form of an official seal. • Share Capital – A company mobilizes its capital by selling it shares.
- 9. Salient features of registered company • Limited Liability – A shareholder’s liability is limited to the amount of share that he has purchased. • Transferability of shares – Shares in a company are transferable and can be sold or purchased in the share market.
- 10. Salient features of registered company • Ownership and management – The owners of a company are its share holders. The affairs of the company are managed by their representatives known as directors
- 11. Difference between Company and partnership • A company is the creation of law where as partnership is based on mutual trust between the partners. • Registration of company is compulsory while it is not compulsory for a firm. • A company has a separate legal existence where as a firm has not individual legal status
- 12. Difference between Company and partnership • Property of the company belongs to the company where as property of the firm belongs to the partners. • Liability of the shareholders is limited where are it is unlimited for partners.
- 13. National Company Law tribunal • Section 10 FB inserted by the companies Act provides that the central government shall, by notification in the Official Gazette, constitute a Tribunal to be known as National company Law Tribunal to exercise and discharge such powers and function as conferred on it.
- 14. Features of NCLT • It is a quasi judicial body composed of experts in corporate law. • It helps faster disposal of cases. • It has simpler procedures and less formality than courts.
- 15. National Company Law tribunal • The tribunal will consists of a president and such number of judicial and technical members not exceeding sixty two, as the central government deems fit to be appointed that Government.