Basis of Difference
|
Private
Company
|
Public
Company
|
a)
Number of persons
|
Minimum number
of members is 2 and the maximum 50, excluding its present or past employee
members.
|
Minimum number
of members is 7 and there is no limit as to maximum numbers.
|
b)
Issue of
Prospectus
|
Prospectus need
not be issued.
|
Prospectus or a Statement
in lieu of Prospectus must be issued for inviting public to subscribe to its
shares or debentures.
|
c)
Transfer of
Shares
|
Transfer of
shares is generally restricted by the articles of association of a private
limited company.
|
The shares of a
public company are freely transferable.
|
d)
Paid-up Capital
|
Minimum paid-up
Capital should be
Rs. 1, 00,000.
|
Minimum paid-up
Capital should be Rs. 5, 00,000.
|
e)
Number of
Directors
|
A Private
Company must have at least two directors.
|
A Public Company
must have at least three directors.
|
f)
Commencement of
Business
|
A Private
Company can commence its business after getting the certificate of
incorporation.
|
In addition to
the certificate of incorporation, certificate for commenc-ement must be
obtained.
|
g)
Quorum
|
The quorum for a
meeting is two.
|
The quorum for a
meeting is five.
|
h)
Name
|
The word
‘Private Limited’ must be used as a part of the name.
|
The word
‘Limited’ must be used as a part of the name.
|
i)
Managerial
Remuneration
|
There is no
restriction on managerial remuneration.
|
Managerial
remuneration cannot exceed 11% of the net profits.
|
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