what is the difference between public company and private
company
- 12 Answers
- 23249 Views
- TCS, I also Faced
- E-Mail Answers
Answers were Sorted based on User's Feedback
Answer / rekha
In Public Company Minimum capital requirement is Rs. 5
lakhs but in pvt. ltd. co. minimum capital requirement is
Rs.1 lac, in public co. minimum no. of directors is 3 but
in pvt. ltd. co. its 2 only, in public co. there is no
restriction on the transfer of shares but in pvt. ltd. co.
there is restriction on the transfer of shares.
| Is This Answer Correct ? | 33 Yes | 5 No |
Answer / m.devi
Under the 1956 companies act:
public limited company means, it have minimum 50 memners
and maximum unlimited.
private companymeans,it will start with minimum 2 members
butnot exceed the fifty members.
| Is This Answer Correct ? | 56 Yes | 29 No |
Answer / divya n r
Private company means a company which has a minimum paid-up
capital of one lakh rupees , restricts the right to
transfer its shares, limits the number of its members to
fifty and prohibits any invitation to the public to
subscribe for any shares or debentures of the company and
also prohibits any invitation or acceptance of deposits
from persons other than its members, directors or their
relatives. to form a private company only 2 members are
required.
A minimum of 7 members are required to form a public
limited company.It must have minimum paid-up capital of Rs
5 lakhs. There is no restriction on maximum number of
members. The shares allotted to the members are freely
transferable.These companies can raise funds from general
public through open invitations by selling its shares or
accepting fixed deposits.These companies are required to
write either ‘public limited’ or ‘limited’ after their names
| Is This Answer Correct ? | 26 Yes | 4 No |
Answer / harshit goyal
Distinction Between A Public Company And a Private Company –
Following are the main points of difference between a Public
Company and a Private Company :-
1. Minimum Paid-up Capital : A company to be Incorporated as
a Private Company must have a minimum paid-up capital of Rs.
1,00,000, whereas a Public Company must have a minimum
paid-up capital of Rs. 5,00,000.
2. Minimum number of members : Minimum number of members
required to form a private company is 2, whereas a Public
Company requires atleast 7 members.
3. Maximum number of members : Maximum number of members in
a Private Company is restricted to 50, there is no
restriction of maximum number of members in a Public Company.
4. Transerferability of shares : There is complete
restriction on the transferability of the shares of a
Private Company through its Articles of Association ,
whereas there is no restriction on the transferability of
the shares of a Public company
5 .Issue of Prospectus : A Private Company is prohibited
from inviting the public for subscription of its shares,
i.e. a Private Company cannot issue Prospectus, whereas a
Public Company is free to invite public for subscription
i.e., a Public Company can issue a Prospectus.
6. Number of Directors : A Private Company may have 2
directors to manage the affairs of the company, whereas a
Public Company must have atleast 3 directors.
7. Consent of the directors : There is no need to give the
consent by the directors of a Private Company, whereas the
Directors of a Public Company must have file with the
Registrar a consent to act as Director of the company.
8. Qualification shares : The Directors of a Private Company
need not sign an undertaking to acquire the qualification
shares, whereas the Directors of a Public Company are
required to sign an undertaking to acquire the qualification
shares of the public Company .
9. Commencement of Business : A Private Company can commence
its business immediately after its incorporation, whereas a
Private Company cannot start its business until a
Certificate to commencement of business is issued to it.
10. Shares Warrants : A Private Company cannot issue Share
Warrants against its fully paid shares, Whereas a Private
Company can issue Share Warrants against its fully paid up
shares.
11. Further issue of shares : A Private Company need not
offer the further issue of shares to its existing share –
holders, whereas a Public Company has to offer the further
issue of shares to its existing share – holders as right
shares. Further issue of shares can only be offer to the
general public with the approval of the existing share –
holders in the general meeting of the share – holders only.
12. Statutory meeting : A Private Company has no obligation
to call the Statutory Meeting of the member, whereas of
Public Company must call its statutory Meeting and file
Statutory Report with the Register of Companies.
13. Quorum : The quorum in the case of a Private Company is
TWO members present personally, whereas in the case of a
Public Company FIVE members must be present personally to
constitute quorum. However, the Articles of Association may
provide and number of members more than the required under
the Act.
14. Managerial remuneration : Total managerial remuneration
in the case of a Public Company cannot exceed 11% of the net
profits, and in case of inadequate profits a maximum of Rs.
87,500 can be paid. Whereas these restrictions do not apply
on a Private Company.
15. Special privileges : A Private Company enjoys some
special privileges, which are not available to a Public Company.
| Is This Answer Correct ? | 12 Yes | 0 No |
Answer / arvind
In a public limited company minimum quorum required to
attend a meeting is 5 and in a private company it is 2.
| Is This Answer Correct ? | 10 Yes | 3 No |
Answer / rekha
In public co. minimum no. of directors are 3 but in pvt.
co. the minimum no. of directors are two, in public co.
min. no. of members are 7 but in pvt. co. min. no. of
members are two.
| Is This Answer Correct ? | 10 Yes | 3 No |
Answer / burramurali
Under the 1956 companies act:
public limited company means, it have minimum 50 memners
and maximum unlimited.
private companymeans,it will start with minimum 2 members
butnot exceed the fifty members
| Is This Answer Correct ? | 35 Yes | 30 No |
Answer / neelima
In a private company two members are must. the number of member cannot exceed fifty
public company:a public company can be started by seven persons and their is no maximum limit for members.
| Is This Answer Correct ? | 5 Yes | 2 No |
Answer / avik mukherjee
basically the differences are given in
149(7) private limited company is allowed to make business
immediately after its incorporation , public limited company
should wait for the LETTER OF OFFER
--Managerial remuneration : Total managerial remuneration
in the case of a Public Company cannot exceed 11% of the net
profits,calculated as per sec 349 &,350 and in case of pvt
company no such mandate 198(4)
Statutory meeting : A Private Company has no obligation
to call the Statutory Meeting of the member, whereas of
Public Company must call its statutory Meeting and file
Statutory Report with ROC sec 165(10)
Number of Directors : A Private Companysec 252 (2) may have 2
directors to manage the affairs of the company, whereas a
Public Company must have atleast 3 directors.sec 252 (1)
| Is This Answer Correct ? | 2 Yes | 1 No |
Answer / puran singh
public company use the word Ltd. in the end of the company
name but private company use the word private Ltd. in the
end of the company name. the minimum member requir for the
public company is 7 but for the private company it is just
2 and maximum for public company is unlimited but for the
private company is 50. minimum paid up capital for the
public company is 5 lakh but for the private company is 1
lakh. in public company the minimum nomber of directors are
3 but in private are only 2. in public company share can be
transfer easily but in private company you can't transfer
your share to the another person.
| Is This Answer Correct ? | 1 Yes | 1 No |
Two charities are setting up a joint fund raising operation. How do you account for this?
what is by brs?
52 Answers Accenture, Accounting, Air Force, Amazon, Capital IQ, Cognizant, FactSet Systems, Genpact, Reliance, Shiva Corporation, Shriram Bio Seed, Shriram General Insurance, Syntel, Thomson, Trimble Navigation, TTSL,
what is procedure to transfer funds between companies registered under sec 25 of the companies act? Is there is possible to get exemption certificate?
I am forming a Pvt. Ltd. company with total 4 no. of directors including myself. I'll be providing all the financing via. initial capital investment + operating cost. We have mutually agreed to keep percentage as - 55% myself and 15% each of other 3 (15x3=45%) now my questions are : 1. What if one person backs out at any given point, what are implications and what would happen to his share of percentage ? 2. What should I do to keep a control on decisions and financial matters in case any of the directors cheats/wants to leave? (as my money will be on stake)
Occasionally it is said that issuing convertible bonds is better than issuing stock when the firms shares are undervalued. Suppose that the financial manager of Decent Furniture Company does in fact have inside information indicating that the decent stock price is too low. Decent furniture earnings will in fact be higher than investor’s expectations. Suppose further that the inside information cannot be released without giving away a valuable competitive secret. Clearly, selling shares at the present low price would harm Decent’s existing shareholders. Will they also lose if convertible bonds are issued? If they do lose in this case, is the loss more or less than it would be if common stock is issued? Now suppose that investors forecast earnings accurately, but still under value the stock because they overestimate Decent’s actual business risk. Does this change your answer to the questions posed in the preceding paragraph? Explain.
what is LIFO method & procedure ? How you can calculate it ? What is Fund flow ? & what is Cashflow method ? whais is the use fund flow & cash flow in company?
when contribution is negative, then how to calculate PV ratio?
Give the company law and income tax law depriciations rates how both are calculte?
what is contra entries defination and meaning and some example
Sir, we have a machinery manufectred plant and now we want to ragistration in service tax what is the procedure for this pls help me in detal . we have ecc no. and tin no. already
what is the Journal entry for Salaries outstanding? Giv an example.
27 Answers ACS, Apple, Cognizant, Genpact, HSBC, Infosys,
Is the premium amount included in the subscribed capital of the company.
Audit 
