Private Sector Enterprises

Public Sector Enterprises

Joint Sector Enterprises

JOINT SECTOR ENTERPRISE

According to the guidelines laid down by the government of India, the capital of a joint sector undertaking is to be shared as follows: government 26%, Private businessmen 25% and the investing public 49%. No single private party can hold more than 25% of the paid up capital without the permission of the Central Government

PRIVATE SECTOR ENTERPRISE

NON COPORATE
Sole Joint Hindu Proprietorship Family Business Partnership

CORPORATE
Joint Stock Company

PARTNERSHIP is is an agreement between persons who have agreed to share profits of a business carried on by all or any of them acting for all.
FEATURES OF PARTNERSHIP
Agreement Mutual Trust Agency Sharing of Profits from business Unlimited liabilities

TYPES OF PARTNERS Active Dormant Secret Nominal

DISSOLUTION OF PARTNERSHIP

By Agreement : with the consent of all the partners.

Compulsory: Unlawful business, Bankruptcy Contingent: Expiry of term, Completion of venture, Death of Partner, Insolvency of any partner Court: Unsound mind, Permanent incapacitated, Guilty of Misconduct, guilty of Breach of Contract, Transfer of interest, Business Losses, Just & Equitable.

Difference between partnership and Co-ownership

S.N. Basis of distinction 1. Mode of creation Partnership By agreement Co-ownership Both by an agreement as well as by operation of law. May not be operated for profits.

2.

Object

3.

Transfer of interest

4.

Mutual agency

Involves community of interest, to earn and distribute profits from a business No transfer of share Can transfer his interest without the consent of and break co-ownership. other partners. Principal as well as agent, No mutual agency. implied authority to act on behalf of others.

PUBLIC SECTOR ENTERPRISE

1. Departmental Undertakings: Like Post and Telegrams, Railways, Broad casting services, Defence Establishments, Automic power projects.

2.

Public Corporations: like RBI, LIC, IDBI, etc.

3. Government Company

JOINT STOCK COMPANY

Joint stock company is a voluntary association of individuals for profit, having a capital divided into transferable shares, the ownership of which is the condition of membership CHARACTERSTICS Voluntary Association Independent legal Entity Perpetual Existence Common Seal Limited Liability Transferability of Shares A Joint Stock Company can be a Public Limited Company or a private limited Company

DIFFERENCE BETWEEN A PUBLIC LIMITED COMPANY AND A PRIVATE LIMITED COMPANY

BASIS
Maximum no. of members Minimum no. of members Commence business Invitation to public

PRIVATE LTD. CO.

50 2 After certificate of incorporation Cannot make an invitation to public to subscribe to its share capital

PUBLIC LTD. CO.

Unlimited 7 After certificate of commencement of business Invitation to public to subscribe to its share capital is mandatory

FORMATION OF A JOINT STOCK COMPANY

PROMOTION INCORPORATION COMMENCEMENT

PROMOTION Promoter is a person who conceives the idea of starting a business, plans the formation of a company and actually brings it into existence. INCORPORATION It is the incorporation which brings a company into existence as a separate corporate entity. The promoter has to take the following preliminary steps in this connection : Ascertainment of availability of the proposed name of the company Application for certificate of incorporation SEBIs Approval to the Draft Prospectus

MEANS OF FINANCE for a Joint Stock Company are: Shares Debentures Short Term/ Long term loans

Preference Shares

Equity Shares

Cumulative Preference Shares Non-cumulative Preference Shares Participating Preference shares Non-Participating Preference Shares Redeemable Preference Shares Non-redeemable Preference Shares

Security

Redemption

Transferability

Conversion

Mortage

Redeemable Irredeemable

Bearer Registered

Convertible Nonconvertible

Unsecured