JOINT STOCK ORGANIZATION
A joint-stock company can be described as business entity which is owned by shareholders. Each aktionar owns the portion of the organization in proportion to his or her title of the company's shares (certificates of ownership).
This enables for the unequal ownership of a business with some investors owning a much larger proportion of the company than others. Shareholders are able to copy their stocks and shares to others without any effects for the continued presence of the organization.
A voluntary organization which is an artificial person made by law, having limited responsibility of it is members and a perpetual succession having its capital divided into transferable shares and which has a common seal off.
A joint stock firm is a non-reflex association produced by people to carry on a particular business intended for profit. People contribute their capital in the forms of stocks and shares in the organization. Company functions in its own name under a common seal off. It has individual entity from the members.
Attributes Of Joint Stock Company:
To comprehend the concept of joint stock (private and open public limited) corporations, consider the following characteristics:
No single individual or possibly a group of individuals can start a business and call it a joint stock organization. A joint stock firm can come in to existence only if it has been signed up after completing all the legal formalities essential by the Of india Companies Work, 1984 A firm is a voluntary association of persons joining hands having a common motive. For the private business formation, there should be at least two associates maximum limit is fifty. For the population company formation, minimum number of members is usually seven and there is no restriction over its maximum number.
Just like a person takes beginning, grows, makes its way into into human relationships and dead, a joint stock business takes delivery, grows, goes in into human relationships and dead. However , it really is called an artificial person as really birth, living and fatality are governed by law. i)a company is definitely lifeless but it really has a advantage of man. ii)A company can prosecute or can be sued in its own identity.
iii)A business can own and hold property in the own identity.
iv)A firm can enforce the contractual rights against others. v)A company can enter into contracts.
Separate legal entity:
As an artificial person, a joint stock business has its own separate existence 3rd party of it's investors. Which means that a joint stock firm can very own property, get into contracts and conduct any lawful business in it can " ownвЂќ name. It might sue and can be sued by others in the court of law. The shareholders will be " notвЂќ the owners of the house owned by company. Also, the shareholders cannot be held accountable for any of the acts with the company. The 2 are two persons in the eyes of rules.
Common seal off:
A joint stock company has a " sealвЂќ, which is used while dealing with others or entering into legal agreements with outsiders. It is called a common seal off as it can be employed by any officer at any level in the organization working away at behalf in the company. Any document, on which the company's seal off is place and is appropriately signed by any official of the business, becomes holding on the business.
For example , a selection manager may possibly enter into an agreement for buying unprocessed trash from a supplier. When the contract newspaper is sealed and fixed by the obtain manager, it might be valid. The purchase administrator may keep the company or perhaps may be removed from his job or might have taken an incorrect decision, however, the contract is valid till a new contract is done or the existing contract runs out.
A joint stock organization continues to can be found as long as that fulfills the requirements of law. It is not troubled by the death, lunacy, insolvency or old age of any of it's buyers. For example , in case there is a private limited company having...