MEANING AND NATURE OF COMPANY LL.B. 3rd Semester

Transcript:MEANING AND NATURE OF COMPANY LL.B. 3rd Semester:
MEANING AND NATURE OF COMPANY LL.B. 3rd Semester Company Law Compiled by- Dr. Rahul Pandey Asst. Professor Shia P.G. College Lucknow Meaning and Definition of Company The word ‘company’ is derived from combination of two Latin words, namely, com and panis. The word ‘com’ means ‘with or together’ and ‘panis’ means ‘bread’. Thus initially the word ‘company’ referred to an association of persons who took their meals together. The merchants in the leisurely past, took advantage of these festive gatherings to discuss their business matters. (Alfred Palmer). The word ‘company’ has no strictly technical or legal meaning (Stanley). Definition of Company Lindley, L.J. By a company is meant an association of many persons who contribute money or money’s worth to a common stock and employ it for a common purpose. Prof. L.H. Haney Company is an artificial person created by law having a separate entity with perpetual succession and a common seal. Justice Marshall A Joint Stock Company is an artificial being, invisible, intangible and existing only in contemplation of law. Justice James A company is an association of persons united for common purpose. A company has been defined in Section 2 (20) of the Companies Act, 2013 as “a company incorporated under this Act or under any previous company law”. The term company means a company incorporated under the Companies Act, 2013 or under any previous company law. The phrase, previous company law, refers to earlier company legislation in India, namely, the Joint Stock Company Act, 1857; the Indian Companies Act, 1866; the Indian Companies Act, 1882; the Indian Companies Act, 1913 and the Companies Act 1956. Thus, the important features of a definition of ‘company’ are as follows:- A company is an artificial person, as it has no body or soul and exists only in the eyes of the law. Law alone can dissolve it. It may purchase and sell property, and, enter into contracts through natural persons. It can sue and can be sued by others. A company is a voluntary association of persons formed for some common purpose. A company is a creation of the law i.e. a company is a ‘legal person’. A company really exists and it is not a fictitious entity. A company comes into existence on its incorporation i.e. on the issue of certificate of incorporation by the Registrar. On incorporation, a company becomes a body corporate or a corporation, and acquires