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    K.R. Mangalam University: Company Law Company and Partnership

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    NEHA
    The document compares and contrasts companies and partnerships across 10 key points: 1. Companies are formed by registration under the Companies Act, while partnerships are created by agreement. 2. Companies are legal entities separate from their members, while partnerships are not legal entities and have no separate existence from their partners. 3. There is no maximum limit on members of a company but minimum is 7 for public and 2 for private, while partnerships cannot have more than 20 members. 4. Liability of company members is limited to their shares but partnership members have unlimited liability for firm debts. This summarizes the key differences between companies and partnerships discussed in the document.

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    K.R. Mangalam University: Company Law Company and Partnership

    Uploaded by

    NEHA
    42 views5 pages
    The document compares and contrasts companies and partnerships across 10 key points: 1. Companies are formed by registration under the Companies Act, while partnerships are created by agreement. 2. Companies are legal entities separate from their members, while partnerships are not legal entities and have no separate existence from their partners. 3. There is no maximum limit on members of a company but minimum is 7 for public and 2 for private, while partnerships cannot have more than 20 members. 4. Liability of company members is limited to their shares but partnership members have unlimited liability for firm debts. This summarizes the key differences between companies and partnerships discussed in the document.

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    Lalit Khatana Cl

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    The document compares and contrasts companies and partnerships across 10 key points: 1. Companies are formed by registration under the Companies Act, while partnerships are created by agreement. 2. Companies are legal entities separate from their members, while partnerships are not legal entities and have no separate existence from their partners. 3. There is no maximum limit on members of a company but minimum is 7 for public and 2 for private, while partnerships cannot have more than 20 members. 4. Liability of company members is limited to their shares but partnership members have unlimited liability for firm debts. This summarizes the key differences between companies and partnerships discussed in the document.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    42 views5 pages

    K.R. Mangalam University: Company Law Company and Partnership

    Uploaded by

    NEHA
    The document compares and contrasts companies and partnerships across 10 key points: 1. Companies are formed by registration under the Companies Act, while partnerships are created by agreement. 2. Companies are legal entities separate from their members, while partnerships are not legal entities and have no separate existence from their partners. 3. There is no maximum limit on members of a company but minimum is 7 for public and 2 for private, while partnerships cannot have more than 20 members. 4. Liability of company members is limited to their shares but partnership members have unlimited liability for firm debts. This summarizes the key differences between companies and partnerships discussed in the document.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 5

    K.R.

    MANGALAM UNIVERSITY

    COMPANY LAW
    COMPANY AND PARTNERSHIP

    SUBMITTED TO: MS. PALKI VATS


    SUBMITTED BY:
    LALIT KHATANA
    BALL 6TH SEMESTER
    1805170039
    Partnership and company
      Both company and partnership are the means of carrying on business and In both
    the relation of members is based on a contract or an agreement. Even then
    following are the main difference in company and partnership.

    1. Formation
    Company is formed by registration under the provisions of companies Act.
    Partnership is created by agreement only. This agreement (or contract) can be
    written or necessary.

    2. Legal entity  

              "Company is a legal person, but partnership firm is not a legal person."
    Partnership firm has no separate entity different from its partners. Group of
    partners Alone is called partnership firm. Defamation of  partnership firm is the
    defamation of partners and in such circumstances partners can bring the suit of
    defamation, not the firm. Being a legal person company has its separate different
    from its members. Company also has got at most all those rights which a legal
    person has. For example, company can acquire and hold property and can transfer
    it, it can enter into contract members or with any other person, it can sue and can
    be sued. For the convenience of partnership firm there is provision in the civil
    procedure code to sue or to be sued in its name But other rights are not available to
    a partnership firm, because it is not a legal person.

    Firm not being an artificial person cannot enter into partnership with other persons
    or any other firm and if it does so the partnership shall be deemed to have been
    entered with all the partners of the firm. But company being an artificial person can
    do so and in this partnership company shall be deemed to be the partner, not all
    shareholders.
    If two companies enter into a partnership between themselves, their mutual rights,
    duties and liability are controlled by the rules of partnership only.

    3. Number of members

           No maximum limit of members of a company is prescribed but minimum


    number is prescribed. There should be at least seven members in a public company
    and two members in a private company. But there should not be more than twenty
    members in a partnership firm and not more than ten in banking firm.

    4. Liability of members

      In company liability of it members (Shareholders) is limited but in partnership


    firm liability of its members (partners) is unlimited. In company with limited
    liability, the liability of its members is limited to the extent of the value of shares
    taken by them. If value of shares has been paid to the company, there is no liability
    of the shareholder. Creditors of the company can recover their debts from the
    company only.

    If limited to the extent of amount guaranteed by them. In partnership firm


    liabilities of partners are not limited. Every partner is liable for all debts and
    liabilities of the firm. If money of any creditor is not recovered from the property
    of the firm, it can be recovered from the personal property of partners. Liability of
    partners is both joint and several. In partnership the liability of partners is
    unlimited. In partnership apart from their shares the personal property of partners is
    also liable for the debts and liabilities of the firm. But in a limited company the
    liability of shareholder is limited. Shareholders liability is limited to the extent of
    their share and their personal property is not liable.
    5. Transferable Share

         Shares of company are transferable , therefore, they can be sold to and person at
    any time. But partner of a firm cannot transfer his Share or partnership in the firm
    nor can make him partner of that firm without the consent of other partners.

    6. Object and powers

                Company can carry on only those trade, commerce, business or undertaking
    which are described in its memorandum of association. If it does any work other
    than these, it shall be void for it being I excess of jurisdiction. There is no such
    prohibition for partnership firm and all partner can at any time make change in
    their business.

    7. Rights and relations of members

                Management of company is in the hands of few elected persons, who are


    called directors. Shareholders have no effective control over directors, because
    shareholders in the immediate are interested only in the profits of the company.
    After being elected directors do not remain agents of shareholders, they are the
    agents of the company and company alone. Only company is liable for their acts,
    not shareholders. In partnership firm, in the absence of any agreement, all partners
    are entitled to take part in the management of the business. They work in dual
    capacity of principle and agent. In connection with the business act done by one
    partner is deemed to be the act of all partners.

    8. Dissolution or winding up

    Company has perpetual succession. It never dies. Members may come and go but
    company remains. Insolvency or death of any member or shareholder does not
    affect the existence of company. Company is created by registration and it is
    dissolved by the order of the court. Partnership firm can be dissolved at any time
    with the consent of partners. In the absence of any agreement on the death or
    insolvency of any partner partnership ceases.

    9.  Formation and dissolution

             Formation, dissolution, determination of rights and duties of partners of a


    firm, in the absence of any country intention is done according to the provisions of
    partnership Act, whereas formation, dissolution, conduct of the business and
    determination of mutual rights and duties and liabilities of directors and
    shareholders of a company is done according to the provisions of Indian companies
    Act.
         In partnership there can be at least two partners and at the most 10 partners in
    case of a firm carrying on banking business and 20 partners in firm carrying on
    other kind of business, but in the companies Act there is no restriction on the
    maximum number of shareholders.

    10. Death

             Death or insolvency of any shareholder has no effect on the existence of a


    company, because company is an artificial person. On the Death or insolvency of
    any partner, in the absence of an agreement of country intention the partnership
    ceases.

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