Difference between
private and public limited company
A company is an artificial person created by law
with a perpetual succession and a common seal. It has legal entity separate
from the persons composing it . it can sue and be sued in its own name.
The following are the Difference in the public and
private limited company
Public
limited company
a)
In public
limited company the minimum number of members may be seven but there is
no restriction for maximum number of members.
b)
The word limited used with the name of the company.
Example. FFC Ltd.
c)
The minimum number of members is seven
d)
The liability of shareholder is limited to the
value of the share purchased
e)
In public limited company It is essential for
the company to issue prospectus
Private
limited company
The Private limited company is divided
into tow parts
a)
Single member company
b)
Multi member company
a) Single member company(S.M.C)
The
following are the characteristics of
single member company
1)
In this type of private limited company.There is
only one member or shareholder in the company
2)
The company uses the word (S.M.C private
limited)
3)
The share of the company are not transferable
4)
The liability of the owner of the company is
limited
5)
The SMC can not be listed at the stock exchange
6)
The issuance of prospectus is not necessary
b) Multi member company
The
following are the characteristics of the Multi member company
1)
In this company the minimum number of members is
tow and maximum is fifty
2)
The company use the word “Private limited” with
its name
3)
There is no restriction for the company to call
the statutory meeting
4)
There is no requirement of statutory audit
5)
It is no essential for the company to issue
prospectus
6)
In this
type of private limited company Minimum number of director is two
7)
In this
type of private limited company,The share of the company are not transferable
