November 2020

Joint Stock Company – Merits and Demerits

Joint Stock company

A Joint Stock company is formed to gain profits by a group of people under the act in which capital is not transferable and the shareholders carry limited liabilities. Any individual can file a case against a company and vice-versa. A company carries an under which it runs; its business and its entity is permanent.

Definition

Section 2 (20) of the Companies Act, 2013 defines a Company very precisely as follows

Company méans a Company incorporated under this Act or under any previous Company Law.

According to Prof. Haney

A joint-stock company is an artificial person created by law having a separate entity with a perpetual succession and a common seal.

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Joint Stock Company as an Artificial Person

A Joint Stock Company is said to be an Artificial Person create by law, having a separate entity with a perpetual succession and a Common Seat.

Brief History

It is assumed that the company came into existence in the 12th century in Italy and in the 16th century in England. In India first of all the East India Company was established in 1600 A.D. In our country Indian Compånies Act was introduced in 1913 for the first time and then in 1956 amended companies act was passed but pow companies are established and dissolved under the Companies Act 2013.

Meaning of a Joint Stock company

A Joint Stock company is formed to gain profits by a group of people under the act in which the capital is not transferable and the shareholders carry limited liabilities. Any individual can file a case against a company and vice-versa. A company carries an under which it runs; its business and its entity is permanent.Read More »Joint Stock Company as an Artificial Person