What is Company Definition & Characteristics of Company

Posted on 04 14 2022

The ultimate guidelines required compliance by large accelerated filers starting on January 1, 2008, and by all other filers starting on January 1, 2009. An Annual General Meeting is a gathering the place company members and administrators meet to discuss the corporate’s affairs. It gives all people Global Standardization in Marketing concerned within the firm the chance to participate in company affairs. Further, it offers a discussion board to share info, discussions and determination-making. If any deed or contract is signed by directors or authorized person on behalf of the company under the seal it binds the company.

the characteristics of a company meeting are

But it is an artificial person, so it cannot take oath, cannot be presented in court and it cannot be divorced or married. If a personal company decides to have AGMs, it should adhere to the deadlines. The annual common assembly must be held within 6 months after the FYE. Next, each company should lodge the compulsory annual return within one month after its AGM. When Annual General Meeting isn’t known as within the stipulated time, penalty up to Rs. 1,00,000 and Rs. 5000 per day is imposed. In contrast, no penalty is prescribed as per regulation for not calling an Extraordinary General Meeting .

Limited liability

Both these legislations are based on the law of agency, each partner becoming an agent of the other, and it, therefore, affords a suitable framework for an association of a small body of persons having trust and confidence in each other. The notice should mention the place, time and date of the meeting. The day must be a working day and the time should be during business hours unless agreed otherwise by all the directors.

It offers its members, the general public and the committee a broad overview of the organisation’s current directions, monetary health and confirms its purpose. It can be the time to revitalise the organisation via the official engagement of members into key elected positions. 4.1Liability under other statutes– Besides the Act, directors and other officers of the company may be held personally liable under the provisions of other statutes. Similarly, under Foreign Exchange Management Act, 1999, the directors and other officers may be proceeded individually or jointly for violations of the Act. Shareholders are not, in the eyes of the law, part owners of the undertaking.

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On timber being destroyed by fire, his claim was rejected for want of insurable interest. The Supreme Court held that though the income in the hands of the company was partly agricultural yet the same income when received by Mrs. Guzdar as dividend could not be regarded as agricultural income. The meetings of creditors are called when the company proposes to make a scheme for arrangement with its creditors. In a large company routine matters like Allotment, Transfer, Finance are handled by sub-committees of the Board of Directors.

The liability of a company can be limited by its guarantee or shares. The liability of the shareholders is limited to a certain guaranteed amount mentioned in the memorandum, payable only in the event of liquidation and losses suffered by the company. Whereas on the other hand, a company limited by shares is when members’ liability is limited to the unpaid amounts or shares they hold. In the case of Union Bank of India v. Khader International Constructions and Others , the question before the Court was whether the company has the right to sue as an indigent person under Order 33, Rule 1 of the Civil Procedure Code 1908.


Generally, that is the one time that the administrators and shareholders will meet throughout the year, so it is a chance for the administrators to current the company’s annual report. A common meeting is a meeting of an organization’s shareholders . Types of meetings are; formal conferences, annual common conferences , statutory meetings, board conferences, and informal meetings.

  • Likewise, shareholders cannot be sued on contracts made by his company.
  • The statutory meeting is held to inform the shareholders about matters relating to incorporation, allotment of share, the details of the contracts concluded by the company, etc.
  • One DIN is sufficient to act as a director in any number of companies.
  • At this meeting, the shareholders and companions could obtain copies of the company’s accounts, review fiscal info for the previous year, and ask any questions relating to the directions the enterprise will take in the future.
  • If there are any elections, make certain to announce them and take care of them at this level.

While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any. Held, the parent and the subsidiary company were one commercial unit and the application for licences was rejected. Held, the debenture was void but ‘W’ could sue the directors for breach of warranty of authority .

Transfer of shares

On registration, a company becomes a body corporate i.e.,it acquires a legal personality of its own, separate and distinct from its members. A registered company is, therefore, created by law and law alone can regulate, modify or dissolve it. Every public company having share capital must convene a general meeting of shareholders within a period of not less than one month and not more than six months after the date on which it is authorised to commence its business. This is the first meeting of the shareholders of the company and it is held once in the whole life of the company. In case of OPC, Dormant Company, Small Company, Sec. 8 Company or any private company( Start-Up), then required to hold two board meetings in each half of calendar year with time gap of at least 90 days.

  • If the number of interested directors is more than or equal to two-thirds of total number of directors, the disinterested directors present in the board, provided that the number is not less than two, deemed the quorum.
  • However, certain occasions may require shareholders to come back collectively on quick notice to deal with an urgent matter, typically regarding company administration.
  • needs to review the security of your connection before proceeding.

She set up a completely private company to which she transferred the premises without government approval. She cannot eliminate the illegality by saying she and her Company are virtually the same person. The company owner must provide the company’s registered office address or temporary address when applying for registration. All correspondences from the ROC will be sent to the address provided in the registration form. If the company address is temporary, it must establish a registered office within 30 days of its incorporation.

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It will also send the Certificate of Incorporation to the company at its registered office address. The Act provides that a private limited company must have a minimum of two members, while the maximum members limit is 200. It is important to comply with the related requirements to ensure your company adheres to the regulation.