Corporate Regulations: Lecture 2 (company- Meaning & Definition)
Companies Act 2013
Companies Act 2013 is an Act of the Parliament of India which regulates incorporation of a company, responsibilities of a company, directors, and dissolution of a company. The 2013 Act is divided into 29 chapters containing 470 sections as against 658 Sections in the Companies Act, 1956 and has 7 schedules. The Companies Act, 2013 has got the assent of the President of India on 29th August 2013 which replaced the Companies Act, 1956.
Meaning of Company
The word ‘company’ is derived from the Latin words (Com- with or together and Panis – bread), and originally referred to an association of persons who took their meals together.
A company means a voluntary association of persons formed to achieve some common objectives, having a separate legal entity independent and separates from its members, with a perpetual succession and a common seal, and with capital divisible into transferable shares. It is a corporate body and a legal person having status and personality distinct and separate from that of the members constituting it. It is called a body corporate because the persons composing it are made into one body by incorporating it according to the law, and clothing it with legal personality, and, so turn it into a corporation. Accordingly, ‘corporation’ is a legal person created by the process other than natural birth. It is, for this reason that a company is called as an artificial person.
A company comes into existence only when it is registered under the Act. When it is registered, it gets a legal personality of its own, separate and distinct from its members. An unregistered company has no such separate legal existence. A company is created by law and law alone can dissolve it.
Definition of a Company
The term ‘company’ may be defined as a group of persons associated together to achieve some common objective. In legal sense, a company means an association of persons incorporated under the existing law of a country.
According to Sec. 2(20) of Companies Act, 2013 a company is defined as “ a company incorporated under this Act or under any previous Company Law”
According to Prof. Kaney – “A company is an artificial person created by law, having separate legal entity, with a perpetual succession and a common seal”.