Difference Between Public Company and Private Company

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DIFFERENCE BETWEEN PRIVATE COMPANY AND PUBLIC COMPANY

PRESENTED BY: DEBASIS BEHERA REGD NO:10HM08

What is company?
 An association of persons who contribute money or money’s worth towards a businessLord Lindley.  Voluntary association formed and organized to carry on a business in the legal name of the association.  Company formed and registered under company act.

What is private company?
Business firm in the private (non-public) sector of an economy, controlled and operated by private individuals (and not by civil servants or government employees). Used also as an alternative term for private limited company.

What is public company?
A public company is a company that has permission to offer its registered securities (stock, bonds etc.) for sale to the general public, typically through a stock exchange or occasionally a company whose stock is traded over the counter (OTC) via market makers who use non-exchange quotation services. Used also as an alternative term for public limited company.

Difference between public and private company
 PRIVATE LTD.
 No. of members can be 2 to 50.  Minimum paid up capital of Rs one lakh.  Minimum number of directors present should be 2.  Can accept deposit only from members, directors or their relatives.

 PUBLIC LTD.
 No. of members can be 7 to unlimited.  Minimum Paid up capital Rs five lakhs.  Minimum number of directors present should be 3.  Can accept public deposits. 5

DIFFERENCE BETWEEN PRIVATE AND PUBLIC COMPANY
 PRIVATE LTD
 Should contain words “Private Limited”at the end of its name.  Cannot invite public to subscribe for shares or debentures.  Statement in lieu of prospectus not required even for first issue.

 PUBLIC LTD
 Should contain word “Limited” at the end of its name.  Can invite public to subscribe for shares or debentures.  Statement in lieu of prospectus OR prospectus required. 6

DIFFERENCE BETWEEN PRIVATE AND PUBLIC COMPANY
 PRIVATE LTD ...
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