Distinguish Between
Private Company and Public Company
HSC Board – Organization of Commerce and Management – Notes, & Distinguish Between, difference between Private Company and Public Company, study notes, studies material, studies notes – according to the New Textbook.
| Sr.
No |
Basis Difference | Private Company | Public Company |
| 1. | Meaning | A private company is a company which by its articles restricts the right to transfer its shares, if any, limits the number of its members to 50. | A public company means a company which is not a private company. |
| 2. | Name | It is compulsory to add the word ‘Private Limited’ after the name if the Private Company. | It is compulsory to add the word ‘limited’ after the name of public company. |
| 3. | Transfer of Share | Shares in private limited company are not transferable. | Public company can invite public for issuing its shares and debentures. |
| 4. | Number of Directors | In a Private limited company a minimum number of 2 directors is essential. | In a Public limited company a minimum number of 3 directors is essential. |
| 5. | Issue of Prospectus | It’s not compulsory to issue the prospectus and statement in lieu of prospectus. | It’s compulsory to issue of prospectus and in the absence of prospectus to sent statement in lieu to the registrar. |
| 6 | Minimum Capital | paid-up capital minimum is one lakh rupees | paid up capital minimum is five lakh rupees |
| 7. | Members | The minimum numbers of members are 2 and maximum 50 | The minimum numbers of members are 7 and there is no maximum limit of members. |