Distinguish between
1) Private Limited Company and Public Limited Company
Ans:
Sr. No. | Point of difference | Private Company | Public Company | ||||
| 1) | Meaning | A private company is a company which by its Articles restricts the right to transfer its shares, if any & limit the number of its members to 200. | A public company means a company which is not a private company. | ||||
| 2) | Number of Members | Minimum – 2 Maximum – 200 | Minimum 7 Maximum – unlimited | ||||
| 3) | Statutory Meeting | This meeting is not compulsory. | It is compulsory | ||||
| 4) | Transfer of Shares | Shares are not freely transferable. | Shares are freely transferable | ||||
| 5) | Capital | Minimum paid up capital is Rs. 100,000. | In public limited minimum paid up capital it is Rs. 500,000 | ||||
| 6) | Issue of prospectus | In private company, statement in lieu of prospectus is issued. | A prospectus is compulsory. | ||||
2) Sole Trading Concern & Partnership Firm
Ans:-
Sr. No. | Points of difference | Sole trading Concern | Partnership Firm |
1) | Meaning | It is owned and controlled by one person. | In this form two or more Partners come together to undertake a business activity and share profits. |
2) | Number of Members | Only one member. | Minimum Two partners & maximum 50 partners are there |
3) | Registration | It is not required. | It is not compulsory in India, but it is compulsory in Maharashtra. |
4) | Liability
| Liability of Sole trader is unlimited. | Liability of partner is unlimited, joint and several. |
5) | Capital | Comparatively limited capital. | Due to contribution of all partners, capital is more. |
6) | Secrecy | There is maximum secrecy. | Secrecy is shared by partners. |
7) | Management | A sole trader is the only manager of his business. | All partners in a partnership firm have equal managerial rights. |
8) | Stability | There is lack of stability, as the business may be affected due to death, insolvency of sole trader. | There is lack of stability, as the business may be affected due to death, insolvency of Partners. |
9) | Government Control | There is minimum government interference. | There is minimum government interference. |
10) | Act / Law | There is no separate Act to govern the activities of sole trading concern. | Indian partnership Act. 1932 is applicable in India. |
11 | Formation | Comparatively easy. | Few legal formalities are required for formation |
3) Partnership Firm & Joint Hindu Family
Ans:-
Sr. No. | Points of difference | Partnership Firm | Joint Hindu Family Business | |
1) | Meaning | In this form two or more Partners come together to undertake a business activity and share profits. | The ancestral business is conducted by family members of Joint Hindu Family. | |
2) | Number of Members | Minimum Two partners & maximum 50 partners are there | There is no limit for number of members. | |
3) | Registration | It is not compulsory in India, but it is compulsory in Maharashtra. | It is not required. | |
4) | Liability | Liability of partner is unlimited, joint and several. | Liability of Karta is unlimited and liability of coparceners is limited. | |
5) | Capital | Due to contribution of all partners, capital is more. | Ancestral property is used as capital. | |
6) | Secrecy | Secrecy is shared by partners. | Secrecy can be maintained because it is family business. | |
7) | Management | All partners in a partnership firm have equal managerial rights. | The Karta is the manager of the business who is assisted by co-parceners. | |
8) | Stability | There is lack of stability, as the business may be affected due to death, insolvency of Partners. | It is comparatively more stable since after the death of KARTA, the next senior most family member becomes KARTA and continues business activity. | |
9) | Government Control | There is minimum government interference. | There is limited government interference. | |
10) | Act / Law | Indian partnership Act. 1932 is applicable in India. | The Hindu Succession Act 1956 and The Hindu Law is applicable. | |
11) | Formation | Few legal formalities are required for formation | Comparatively simple and easy. | |
4) Co-operative Society & Joint Stock Company
Ans:-
Sr. No. | Points of difference | Joint Hindu Family Business | Co-operative Society | ||
1) | Meaning | The ancestral business is conducted by family members of Joint Hindu Family. | It is a voluntary association of individuals to provide services to its members. | ||
2) | Number of Members | There is no limit for number of members. | Minimum 10 and maximum no limit for number of members. | ||
3) | Registration | It is not required. | It is compulsory. | ||
4) | Liability | Liability of Karta is unlimited and liability of coparceners is limited. | Liability of shareholders is limited up to the extent of unpaid amount on share held by them. | ||
5) | Capital | Ancestral property is used as capital. | Comparatively more capital than sole trading concern. Partnership Firm and JHFB. | ||
6) | Secrecy | Secrecy can be maintained because it is family business. | Less business secrecy. | ||
7) | Management | The Karta is the manager of the business who is assisted by co-parceners. | Managing Committee is the managing body of co operative society. | ||
8) | Stability | It is comparatively more stable since after the death of KARTA, the next senior most family member becomes KARTA and continues business activity. | It is a stable business due to independent legal status. | ||
9) | Government Control | There is limited government interference. | There is strict government control. | ||
10) | Act / Law | The Hindu Succession Act 1956 and The Hindu Law is applicable. | The India Co-operative Society’s Act 1912 and the respective State Cooperative Society’s Act. | ||
11) | Formation | Comparatively simple and easy. | Formation is comparatively cheaper but time consuming due to many legal formalities. | ||
5) Joint Hindu Family Firm and Joint Stock Company
Ans:-
Sr. No. | Points of difference | Joint Hindu Family Business | Joint Stock Company | |
1) | Meaning | The ancestral business is conducted by family members of Joint Hindu Family. | It is an incorporated association of individuals for profit having capital divided into transferable shares, the ownership of which is the condition of membership. | |
2) | Number of Members | There is no limit for number of members. | Private company Minimum 2-maximum 200.Public Company Minimum 7 and there is no limit of maximum number of members. | |
3) | Registration | It is not required. | It is compulsory. | |
4) | Liability | Liability of Karta is unlimited and liability of coparceners is limited. | Liability of shareholders is limited up to the extent of unpaid amount on shares held by them. | |
5) | Capital | Ancestral property is used as capital. | Huge Capital. | |
6) | Secrecy | Secrecy can be maintained because it is family business. | Less business secrecy. | |
7) | Management | The Karta is the manager of the business who is assisted by co-parceners. | Board of Directors looks after the management of the company. | |
8) | Stability | It is comparatively more stable since after the death of KARTA, the next senior most family member becomes KARTA and continues business activity. | It is stable business due to independent legal status. | |
9) | Government Control | There is limited government interference. | There is strict Government control. | |
10) | Act / Law | The Hindu Succession Act 1956 and The Hindu Law is applicable. | The Companies Act, 2013 is applicable. | |
11) | Formation | Comparatively simple and easy. | Formation is complicated, costly and time consuming as there are many legal formalities. | |
6) Co-operative Society & Partnership Firm
Ans:-
Sr. No. | Points of difference | Partnership Firm | Co-operative Society | |
1) | Meaning | In this form two or more Partners come together to undertake a business activity and share profits. | It is a voluntary association of individuals to provide services to its members. | |
2) | Number of Members | Minimum Two partners & maximum 50 partners are there | Minimum 10 and maximum no limit for number of members. | |
3) | Registration | It is not compulsory in India, but it is compulsory in Maharashtra. | It is compulsory. | |
4) | Liability | Liability of partner is unlimited, joint and several. | Liability of shareholders is limited up to the extent of unpaid amount on share held by them. | |
5) | Capital | Due to contribution of all partners, capital is more. | Comparatively more capital than sole trading concern. Partnership Firm and JHFB. | |
6) | Secrecy | Secrecy is shared by partners. | Less business secrecy. | |
7) | Management | All partners in a partnership firm have equal managerial rights. | Managing Committee is the managing body of co operative society. | |
8) | Stability | There is lack of stability, as the business may be affected due to death, insolvency of Partners. | It is a stable business due to independent legal status. | |
9) | Government Control | There is minimum government interference. | There is limited government interference. | |
10) | Act / Law | Indian partnership Act. 1932 is applicable in India. | The India Co-operative Society’s Act 1912 and the respective State Cooperative Society’s Act. | |
11) | Formation | Few legal formalities are required for formation | Formation is comparatively cheaper but time consuming due to many legal formalities. | |