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What is the essential characteristic of a company's artificial legal personality?
- a)It has physical existence like a natural person.
- b)It can enjoy the rights under the Constitution and Citizenship Act.
- c)It can directly interact with the public.
- d)It exists only in the eyes of the law.
Correct answer is option 'D'. Can you explain this answer?
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What is the essential characteristic of a company's artificial legal p...
The essential characteristic of a company's artificial legal personality is that it exists only in the eyes of the law. It doesn't have a physical existence like a natural person, but it possesses certain properties and rights as granted by its legal creation.
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What is the essential characteristic of a company's artificial legal p...
Essential Characteristic of a Company's Artificial Legal Personality
The essential characteristic of a company's artificial legal personality is that it exists only in the eyes of the law. This means that a company is considered a separate legal entity from its owners or shareholders, and it can enter into contracts, own property, sue and be sued, and engage in other legal activities just like a natural person.
Explanation
- Distinct Entity: A company's artificial legal personality allows it to be treated as a separate legal entity, distinct from its owners. This separation provides protection to the owners' personal assets in case the company faces legal issues or financial difficulties.
- Limited Liability: One of the key advantages of a company's legal personality is limited liability. This means that the owners' liability is limited to the amount they have invested in the company, protecting their personal assets from the company's debts and obligations.
- Perpetual Existence: Another important aspect of a company's artificial legal personality is its perpetual existence. Unlike natural persons, a company does not cease to exist if its owners pass away or transfer their shares. This allows for continuity and stability in the company's operations.
- Legal Rights and Obligations: As a separate legal entity, a company can enjoy rights under the law, enter into contracts, acquire assets, and incur liabilities. It can also be held accountable for its actions and be subject to legal obligations.
In conclusion, the essential characteristic of a company's artificial legal personality is that it exists only in the eyes of the law, providing it with rights, obligations, and protections similar to those of a natural person.
The essential characteristic of a company's artificial legal personality is that it exists only in the eyes of the law. This means that a company is considered a separate legal entity from its owners or shareholders, and it can enter into contracts, own property, sue and be sued, and engage in other legal activities just like a natural person.
Explanation
- Distinct Entity: A company's artificial legal personality allows it to be treated as a separate legal entity, distinct from its owners. This separation provides protection to the owners' personal assets in case the company faces legal issues or financial difficulties.
- Limited Liability: One of the key advantages of a company's legal personality is limited liability. This means that the owners' liability is limited to the amount they have invested in the company, protecting their personal assets from the company's debts and obligations.
- Perpetual Existence: Another important aspect of a company's artificial legal personality is its perpetual existence. Unlike natural persons, a company does not cease to exist if its owners pass away or transfer their shares. This allows for continuity and stability in the company's operations.
- Legal Rights and Obligations: As a separate legal entity, a company can enjoy rights under the law, enter into contracts, acquire assets, and incur liabilities. It can also be held accountable for its actions and be subject to legal obligations.
In conclusion, the essential characteristic of a company's artificial legal personality is that it exists only in the eyes of the law, providing it with rights, obligations, and protections similar to those of a natural person.
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What is the essential characteristic of a company's artificial legal personality?a)It has physical existence like a natural person.b)It can enjoy the rights under the Constitution and Citizenship Act.c)It can directly interact with the public.d)It exists only in the eyes of the law.Correct answer is option 'D'. Can you explain this answer?
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What is the essential characteristic of a company's artificial legal personality?a)It has physical existence like a natural person.b)It can enjoy the rights under the Constitution and Citizenship Act.c)It can directly interact with the public.d)It exists only in the eyes of the law.Correct answer is option 'D'. Can you explain this answer? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about What is the essential characteristic of a company's artificial legal personality?a)It has physical existence like a natural person.b)It can enjoy the rights under the Constitution and Citizenship Act.c)It can directly interact with the public.d)It exists only in the eyes of the law.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What is the essential characteristic of a company's artificial legal personality?a)It has physical existence like a natural person.b)It can enjoy the rights under the Constitution and Citizenship Act.c)It can directly interact with the public.d)It exists only in the eyes of the law.Correct answer is option 'D'. Can you explain this answer?.
What is the essential characteristic of a company's artificial legal personality?a)It has physical existence like a natural person.b)It can enjoy the rights under the Constitution and Citizenship Act.c)It can directly interact with the public.d)It exists only in the eyes of the law.Correct answer is option 'D'. Can you explain this answer? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about What is the essential characteristic of a company's artificial legal personality?a)It has physical existence like a natural person.b)It can enjoy the rights under the Constitution and Citizenship Act.c)It can directly interact with the public.d)It exists only in the eyes of the law.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What is the essential characteristic of a company's artificial legal personality?a)It has physical existence like a natural person.b)It can enjoy the rights under the Constitution and Citizenship Act.c)It can directly interact with the public.d)It exists only in the eyes of the law.Correct answer is option 'D'. Can you explain this answer?.
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