Answer:
Ans. Differences between Memorandum of Association and Articles of Association
Memorandum of Association
Articles of Association
1. Importance: It has primary importance in the formation of company.
It has a secondary importance in the formation of company.
2. Constitution: It is a constitution of the company.
It contains rules which govern the administra- tion of the company.
3. Object: It lays down the objects of the company.
It contains the procedure of achieving objects. The provision can be changed by the special resolution easily.
4. Alternate: It is not alterable but it can be amended by special resolution and sanction of the court or central government.
Articles of Association can be amended by a special resolution.
5. Relation: Its nature is like contract between the company and outsiders like bankers and creditors.
It maintains relation between the company and the persons inside the company.
6. Regulation: It contains rules which governs the administration of the company.
The Registration of Articles is optional for the company limited by shares. It may adopt all or any of regulations.
7. Nature of Document: It does not allow the company to act against the company ordinance.
It is a subsidiary document to Memorandum of Association.
8. Limits: This document determines the limits of the company business.
Business limits are not mentioned in it.
Differences between Public Company and Private Company
Private Company
Public Company
1. Minimum and Maximum Members: It has minimum 2members and maximum 50 members.
It has minimum 7 members and maximum unlimited members.
2. Invitation to general public: debentures. Public: It cannot invite c to buy its shares and
It invites general public to buy its shares and debentures.
3. Transfer of Shares: There are certain restriction on transfer of its shares.
Its share are freely transferable.
4. Commencement of Business: It can commence business after incorporation.
It can commence business after obtaining certificate of commencement of business.
5. Name: It has to write Private Ltd after its name
It can commence business after obtaining certificate of commencement of business.
6. Minimum Capital: Minimum capital required is one lakh
In it minimum capital required is five lakhs
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