Public
Limited Company
A public limited company is a form of organization that is incorporated
and, has a separate legal existence. The liability of its members is
limited to the extent of capital invested. The formation, working and
winding up, and all other activities are regulated by the laws, rules
and regulations under the Companies Act 1956.
Features
- Separate Legal Entity: A public company is a separate
legal entity independent of its members who formed it.
- Registration: It is mandatory to register the company
with the ROC.
- Number of Members: The company must have a minimum of 7
members and there is no limit to the maximum number of members.
- Raising Capital: The company can raise capital by
inviting public to subscribe to its shares / debentures.
- Transfer of Shares: The shares of the company are easily
and freely transferable among members. No prior consent of
shareholders is required.
Public Limited Company Advantages
- Continuous existence
- Larger amount and easy sourcing of capital
- Efficient management
- Limited liability of members
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