CA Foundation Exam > CA Foundation Questions > Minimum number of members in case of public c...
Start Learning for Free
Minimum number of members in case of public company
- a)1
- b)2
- c)5
- d)7
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
Minimum number of members in case of public companya)1b)2c)5d)7Correct...
Minimum number of members in case of public company:
- According to the Companies Act, 2013, a public company must have a minimum number of members. The minimum number of members required is 7.
- This means that a public company cannot be formed or incorporated with less than 7 members.
- The Companies Act also specifies that in the case of a public company, there is no maximum limit on the number of members.
- The minimum number of members is necessary to ensure that the company has a sufficient number of shareholders to share the ownership and responsibilities of the company.
- The requirement of a minimum number of members in a public company is intended to ensure that there is adequate representation and diversity of interests among the shareholders.
- The minimum number of members also provides a level of protection for the shareholders by ensuring that decisions are made collectively and not by a single individual.
- It is important for a public company to have a minimum number of members to maintain transparency, accountability, and proper governance.
- The requirement of a minimum number of members may vary in different jurisdictions, so it is essential to consult the relevant laws and regulations in the specific country or region.
- According to the Companies Act, 2013, a public company must have a minimum number of members. The minimum number of members required is 7.
- This means that a public company cannot be formed or incorporated with less than 7 members.
- The Companies Act also specifies that in the case of a public company, there is no maximum limit on the number of members.
- The minimum number of members is necessary to ensure that the company has a sufficient number of shareholders to share the ownership and responsibilities of the company.
- The requirement of a minimum number of members in a public company is intended to ensure that there is adequate representation and diversity of interests among the shareholders.
- The minimum number of members also provides a level of protection for the shareholders by ensuring that decisions are made collectively and not by a single individual.
- It is important for a public company to have a minimum number of members to maintain transparency, accountability, and proper governance.
- The requirement of a minimum number of members may vary in different jurisdictions, so it is essential to consult the relevant laws and regulations in the specific country or region.
Free Test
FREE
| Start Free Test |
Community Answer
Minimum number of members in case of public companya)1b)2c)5d)7Correct...
Minimum number of members in case of public company
In the case of a public company, the minimum number of members required is 7. This requirement is specified in the Companies Act, 2013, which governs the formation and functioning of companies in India. Let's understand the rationale behind this requirement and the provisions of the Act in more detail.
Provisions of the Companies Act, 2013
The Companies Act, 2013 lays down the legal framework for the establishment, operation, and management of companies in India. It defines a public company as a company that is not a private company and has a minimum paid-up share capital of Rs. 5 lakh or a higher amount as prescribed by the Act.
Minimum number of members for a public company
According to Section 2(71) of the Companies Act, 2013, a public company must have a minimum of 7 members. This means that at least seven individuals are required to come together and form a public company. These individuals can be natural persons or corporate entities.
Reasoning behind the minimum number requirement
The requirement of a minimum number of members in a public company is primarily aimed at ensuring the presence of a diverse group of stakeholders who can collectively participate in the decision-making process. By having a larger number of members, the company's governance is less likely to be influenced solely by the interests of a few individuals.
The involvement of multiple members also helps in bringing in varied perspectives, expertise, and resources, which can contribute to the overall growth and development of the company. Additionally, a larger number of members may enhance the credibility and public trust in the company.
Conclusion
In conclusion, the minimum number of members required in the case of a public company is 7, as per the provisions of the Companies Act, 2013. This requirement ensures a broader representation of stakeholders and promotes better governance, decision-making, and accountability within the company.
In the case of a public company, the minimum number of members required is 7. This requirement is specified in the Companies Act, 2013, which governs the formation and functioning of companies in India. Let's understand the rationale behind this requirement and the provisions of the Act in more detail.
Provisions of the Companies Act, 2013
The Companies Act, 2013 lays down the legal framework for the establishment, operation, and management of companies in India. It defines a public company as a company that is not a private company and has a minimum paid-up share capital of Rs. 5 lakh or a higher amount as prescribed by the Act.
Minimum number of members for a public company
According to Section 2(71) of the Companies Act, 2013, a public company must have a minimum of 7 members. This means that at least seven individuals are required to come together and form a public company. These individuals can be natural persons or corporate entities.
Reasoning behind the minimum number requirement
The requirement of a minimum number of members in a public company is primarily aimed at ensuring the presence of a diverse group of stakeholders who can collectively participate in the decision-making process. By having a larger number of members, the company's governance is less likely to be influenced solely by the interests of a few individuals.
The involvement of multiple members also helps in bringing in varied perspectives, expertise, and resources, which can contribute to the overall growth and development of the company. Additionally, a larger number of members may enhance the credibility and public trust in the company.
Conclusion
In conclusion, the minimum number of members required in the case of a public company is 7, as per the provisions of the Companies Act, 2013. This requirement ensures a broader representation of stakeholders and promotes better governance, decision-making, and accountability within the company.
|
Explore Courses for CA Foundation exam
|
|
Similar CA Foundation Doubts
Top Courses for CA FoundationView all
Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer?
Question Description
Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer?.
Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer?.
Solutions for Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer?, a detailed solution for Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer? has been provided alongside types of Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Minimum number of members in case of public companya)1b)2c)5d)7Correct answer is option 'D'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
|
|
Explore Courses for CA Foundation exam
|
|
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
|
Signup to see your scores
go up
within 7 days!
within 7 days!
Takes less than 10 seconds to signup