A company is an artificial person whose business is run by a few natural persons in the interest or the profit of some natural persons.
1. On the basis of Mode/Source of Incorporation:
(a) Chartered Company –
This type of company is incorporated under a royal charter issued by the king or head of the state. These were popular in England. East India company is its example.
(b) Statutory Company (Incorporated under special Act) –
These companies are formed under a special Act of parliament or a state legislature to work in the national interest.
2. On the Basis of Liability of members –
(a) Companies limited by share –
The shareholders of such companies are not liable to pay anything more than the value of shares held by them. These companies have to use the word ‘limited’ on compulsory basis.
(b) Companies limited by Guarantee –
The amount of guaranteed money is limited and they are not liable to pay more than this amount. Chambers of commerce is the best example of such companies.
3. On the basis of the number of members –
(a) One Person Company –
A company having only one member. He/she has limited liability unless it is an unlimited company.
(b) Private Company –
A private company under Companies Act means a company having authorised paid-up capital and which is restricted by its articles. The number of its members (except OPC) is limited to 200. It is mandatory for such a company to use the word ‘Private limited’ at the end of its name.
(c) Public Company –
All the companies other than private companies on any company which does not have restrictions like a private company.
4. On the basis of Control –
(a) Holding Company –
If one company can control the policies of another, it is called a holding company.
(b) Subsidiary Company –
The company which is controlled by some other company.
(c) Associate Company –
The company which is controlled by some other company, but is not its subsidiary company.
5. On the basis of Capital/Stock Market –
(a) Listed Company –
The shares and debentures issued by the companies can be freely traded in stock exchanges (BSE, NSE) only when the company is registered with one of the recognised stock exchanges as per SEBI’s guidelines and rules.
(b) Unlisted Companies –
Any company which is not registered/listed with any stock exchange is an unlisted company. The securities, shares and debentures issued by such companies are not freely traded in stock markets.
6. Other Companies –
(a) Government Company –
Company in which not less than 51% of its paid-up share capital is held by central or state government.
(b) Foreign Company –
Any company incorporated outside India, but has a place of business in India through its branches or agencies.
(c) Foreign Exchange Regulation Act –
The companies which are operating in India under the Foreign Exchange Regulation Act.
(d) Defunct/Dormant Company –
When a company does not file an annual return/ financial statements for two consecutive financial years, ROC can enter its name in the dormant companies category.
