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Company Law Important Sections Short Definitions (CS Executive)

Sec. 2(68)

Private company means a company restricts the right to transfer its shares, limit the maximum number of  members to 200 joint share  shall be treated as a single member, employees and  ex-employees shall not be included in number of members, prohibit any invitation to public to subscribe its securities.


Sec. 2(69) Promoter:-

Who has been named as such in prospectus, who has control over the affairs of company, in accordance with whose advice board of directors is accustomed to act except person in professional capacity.


Sec. 2(70) Prospectus :-

Any document issued as prospectus includes Red Herring Prospectus or shelf prospectus or any notice circular inviting offers from public for the subscription or purchase of any securities of a body corporate.


Sec 2(71)Public company :-

means a company which is not private, and includes subsidiary co of public company.



Sec 2 (62) One Person Company -

One Person is member and can be sole director. Natural Person + Indian citizen  (whether Resident /Not) .One person can't incorporate more than one OPC.MOA of OPC shall indicate name Nominee which can be of changed OPC cannot be allowed to be sec. 8 company.


Sec 2(46) Holding company

In relation to other company of which such other companies are subsidiary companies.


Sec 2(87) Subsidiary company:-

company in which Holding company either controls composition of BOD OR control more than half of Voting Power at own or with subsidiaries


Note- No company shall have more than 2 layers of subsidiaries.


Sec 2(6) Associate Company -

In relation to another company in which other co. [which is not subsidiary] BUT has significant influence or is joint Venture.


Significant influence >=20% of Voting Power or control. Voting Power= Total votes at Poll.


Sec 2(45)Government Company:-

company in which Atleast 51% of Paid Share up Capital is held by either by Central Govt OR State Govt (s) OR Jointly by both also includes Subsidiary of a Government company.


Sec 2(42) Foreign Company:-

Company/Body Corporate incorporated outside India which has a place of Business in India AND conducts any business activity in India.


Sec 2(41)Financial year

i) 1st financial year:If company incorporated on after 1st jan


Finiancial year- date to 31st march Next year!

Otherwise -incorporation date to 31 March


ii) subsequent financial year 1 April to 31st March.


Sec 2(52)Listed Company  which has securities listed on RSE Prescribed in consultation with SEBI.


Not listed company


Public co.- listed only Debt securities / Pref shares on Private Placement listed


Private co. - listed debt securities on private placement


Listed but in foreign stock exchange.



Sec. 2(51)Key Managerial Personnel :-

CEO, Managing Director , Company Secretary, Chief financial officer, Prescribed officer, Manager, Whole Time Director, Officer designated as KMP(one level below director).


Sec. 2(60)Officer in Default -


1) KMP~if No KMP~ Director Specified by BOD~If no specified all directors


2)WTD


3)Person on whose directions BOD is accustomed to act


4)Person under Board/KMP's authority charged with such responsibility


5)Director aware + No objection/ Gave consent


6)Share transfer Agents / Merchant Banker in case of Share issue/transfer.



Only Small company, section 8 company and relative, related party are not defined here rest all done.


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