Q.2 Explains the various kinds of joint stock company according to companies ordinance 1984.
Ans: KINDS OF JOINT STOCK COMPANY
Following are the kinds of Joint Stock Company:
The company which is incorporated charter granted by the King or Queen in exercise of an ancient prerogative vested in the crown. A chartered company is regulated by its charter and company. Act does not apply to it. Such companies have not place inPakistansince independence. At present all companies are registered under the company, lawPakistancompanies are registered under Companies Ordinance l984. (The word chartered is used as a part and parcel of the value of such a company).
(iI) East India Company
(ii) Chartered Bank ofEngland
(iii) Reserve Bank ofPakistan
2. STATUTORY COMPANIES
Statutory companies are created by the special acts of parliament or state legislature. A statutory company is governed by the provision of the special act creating it. InPakistan, statutory company is formed by the order of Governor General; President or Prime Minister Statutory Company is organized for the purpose of carrying on some important business of national level. The word “LIMITED’ may not be used after the name of statutory company. Each statutory company can exercise its particular power, which is governed by the terms of its special act. The statutory company is generally found in case of railway, Gas and Electricity.
(i) State Bank ofPakistan
(ii) Industrial Development of Pakistan
(iii) National Bank ofPakistan
3. REGISTERED COMPANIES
Registered companies, which are incorporated under the Companies Act, inPakistan, there is Companies Ordinance, 1984 to form and supervise the registered company. A registered company possesses separate legal entity apart from its members.
(i) Habib Industries Limited
(ii) Wazir Ali Industries
REGISTERED COMPANY HAS FOLLOWING KINDS/TYPES
1. UNLIMITED COMPANY
A registered company may be an unlimited company, in which the liability of its members would be unlimited so that they can be called upon to pay to the full extent of their fortunes in order to meet the obligations of the company. Such companies are now almost extinct, as a vast majority of them have registered themselves limited companies.
2. COMPANY LIMITED BY GUARANTEES
Another class of a registered company is a guarantee company with its capital limited by guarantee so that each member undertakes to be liable to pay the debts of the company up to a certain amount in case of winding up Trade associations and societies for promoting social objects are examples of this type and in the case of these companies, there is no intention to make profit.
COMPANY LIMITED BY SHARES
Where the liability of each member is limited by shares the liability of each member is limited to the amount of the shares which he holds is called company limited by shares.
CLASSIFICATION OF COMPANY LIMITED BY SHARES
It may be classified into two.
1. PUBLIC COMPANY
A public, limited company can be formed by at least seven members and there is no limit to the maximum member. There are not restrictions for transferring of shares, for maximum number of members and for subscription of shares and debentures is called public company.
2. PRIVATE COMPANY
A private company means a company which by its articles
1. Restricts the right to transfer its shares if any, and
2. Limits the member of its members of fifty (5) exclusive of persons employment of the company, and
3. Prohibits any invitation to the public to subscribe for the share, if any, or debentures of the company (Section 2 (28) of the company Ordinance, 1984).