Private Ltd Companies:
The share holders' requirements are- a minimum of 2.The liabilities are restricted to the share holders' personal wealth and stakes, proportionately.
Any two share holders/directors,in a 3 member organisation, can pass any resolution for the company.
There are no qualifications, for appointment of the directors.
No working experience is required.
There are fewer legal obligations to be fulfilled in the Company Law Board.
The companies are to submit the annual profit and loss account to the Registrar of Companies.
Any appointment/ resignation is to be informed to the ROC.
In a Public Ltd. company, there has to be a minimum of 7 share holders,
to invest for a minimum of one share.
The liabilities of the share holders are prime.
Regular Board Meetings are to be called.
Annual General Body Meetings are to be held every year.
Decisions about the companies activities are to be ratified by the share holders, in the AGMs.
The majority of the Share holders, through the directors, can pass any resolution for the betterment of the company.
For passing any special resolution for the the company, board members would require at least 76% of votes of the share holders to pass the same.
Such resolutions, if passed, can be very serious in nature.
All such resolutions are to be sent to the ROC.
There are requirements of maintaining Minutes' Book of the company.
The share holders cannot be denied to inspect the minutes' book.
The Board of Directors are to be qualified to run a company.
Although there may be several directors in such a company, but the financial implications involves the entire share holders, irrespective of each directors' stake.
Any aggrieved minority share holder (a group), having more than 5%shares, if he feels, that the company is doing something wrong, against the interests of them/him can file a petition in the CLB u/s 398-399 of the Company Act 1956, for mismanagement and winding up of the company.
The obligations are too many to protect the interests of the share holders, having 5% + shares.
As per the new laws, there has to be a company secretary in a public ltd co.
These companies are elligible to float IPO, if there are profits for the last
three years, for any expansion projects, subject to the approval of SEBI.
I think this information is sufficient for you.
Pooja Sharma Parmar
6th May 2010 From India, Pune