Types of companies

3. Companies limited by Guarantee:
In a guarantee Company the liability of a share holder is limited to the amount he has voluntary undertaken to contribute towards the assets of the company to meet out any deficiency at the time of it winding up. Such a company may or may not have share capital
III. On the basis of number of members
1. Private Company:
A company which has minimum paid up capital of 1000$ or such higher paid up capital as many be prescribed, and by its article.
A) Restricts the right to transfer its shares, if any.
B) Limits of the members is up to 50.
C) Prohibits any invitation to the public to subscribe for any shares in, or debentures of, the company.
D) Prohibits any invitation or acceptance of deposits from persons other than its members, directors or their relatives.
2. Public company
A public company means a company which
a) has a minimum paid up capital of 6500$ or such higher paid up capital, as many be prescribed.
b) Is a private company which is a subsidiary of a company which in not a private company.
Every public company, existing on the commencement of the companies Act, 200, with a paid up capital of less than 6500$, within a period of two years from such commencement, enhance its paid up capital to 6500$
IV. On the basis of control
1.Holding companies:
А company is known as the holding company of another company if it has control over the other company. According to sec 4(4) a company is deemed to be the holding company of another if, but only if that other is its subsidiary. A company may become a holding company of another company in either of the following three ways:

• By holding more than 50 per cent of the normal value of issued equity capital of the company
• By holding more than 50 per cent of its voting rights
• by securing to itself the right appoint, the majority of the directors of the other company, directly or indirectly