basic idea on Indian Companies Act and Indian Partnership Act

1. PRIVATE VS
PARTNERSHIP
V . Shiva Prakash
141576

2. Meaning and Definition of a
Company
 Section 3(1)( i ) of the Companies Act,
2013 defines a company as: “a
company formed and registered under
this Act or an existing Company”.
 ‘Existing Company’ means a company
formed and registered under any of
the earlier Company Laws.

3. Private Company [Section
3(1)(iii)]
 A private company means a company
which has a minimum paid up capital of
one lakh rupees or such higher paid-up
capital as may be prescribed and by its
articles :
(a) restricts the right to transfer its
shares, if any;
(b)limits the number of its members to
200, not including:

4. Private Company
…contd.
(i) persons who are in the employment
of the company, and
(ii) persons who, having been formerly in
the employment of the company, were
members of the company while in that
employment and have continued to be
members after the employment ceased;
(c) prohibits invitation to the public to
subscribe for any shares in or
debentures of, the company; and

5. Private Company
…contd.
(d) prohibits any invitation or acceptance of
deposits from persons other than its
members, directors or their relatives.
 Where two or more persons hold one or
more shares in a company jointly, they
shall, for the purposes of membership,
be treated as a single member.

6. Public Company [Section 3(1)(iv)]
 A public company means a company which:
(a) is not a private company [In other words, it
should not have the restrictions of Section
3(1)(iii) in its articles ];
(b) has a minimum paid-up capital of five lakh
rupees or such higher paid-up capital, as may
be prescribed; and
(c) is a private company, which a subsidiary of a
company, which is not a private company.

8. THE INDIAN PARTNERSHIPACT’ 1932
 Section.4 of the Indian Partnership Act, 1932
defines Partnership in the following terms:
 “ Partnership is the relation between persons
who have agreed to share the profits of a
business carried on by all or any of them
acting for all.”

9. ESSENTIAL ELEMENTS OF A
PARTNERSHIP
 a.) There must be a contract.
 b.) Between two or more persons.
 c.) Who agree to carry on business.
 d.) With the object of sharing profits.
 e.) The business must be carried on by all or
any of them acting for all.

10. Types of Partnership
Partnership at Will
(Sec.7)
Particular Partnership
(Sec.8)
On the Basis of Duration

11. KINDS OF PARTNERSHIP:
1.Partnership at will:
 Where no provision is made by contract between
the partners for the duration of their partnership, the
partnership is ‘partnership at will.’
 The essence of a partnership at will is that the
partners do not fix any term of partnership and are
free to break their relationship at their own sweet
will. It is a partnership for an indefinite period.

12. Particular partnership:
 When a partnership is formed for a particular
period or for a particular venture, it is called
particular partnership. In such a case, the
partnership is automatically dissolved at the
expiry of the fixed term or on the completion
of the venture.

13. Rights of Partners
1. Right to take part in the conduct of the business.
2. Right to be consulted.
3. Right to access the books.
4. Right to share the profits.
5. Right to interest on capital
6. Right to interest on advances.
7. Right to indemnity.

14. Maximum Limit on Number of Partners
 Section 11 Companies Act provides that the
maximum no. of persons, a firm can have:
In case of partnership firm carrying on a banking business 10
In case of partnership firm carrying on any other business 20
If the number of partners exceeds the limit, the
partnership firm becomes an illegal association.
If an association of persons or firm having members or partners exceeding
the Above limit will not be an illegal association if that firm’s objective is not to
earn profit.

15. THANK YOU