A Public Limited Company under Company Act 2013 is a company that has limited liability and offers shares to the general public
Incorporating a Public limited company is a technical task due care should be taken while incorporating a Public limited company. The Government of India has taken various steps to make incorporation process simplifies, however a layman himself cannot incorporate a Public limited company, one has to appoint a professional to complete this task. Now, the companies are incorporated via E-Form SPICe. E-Form SPICe (INC-32) deals with the single application for reservation of name, incorporation of a new company and/or application for allotment of DIN and/or application for PAN and TAN. Once the E-Form is processed and found complete, company would be registered and CIN would be allocated. Also DINs gets issued to the proposed Directors who do not have a valid DIN. Maximum three Directors are allowed for using this integrated form for filing application of allotment of DIN while incorporating a company. Also PAN and TAN would get issued to the Company.
If you need further clarification regarding the process of our working, do watch this video. It is a step by step guide to understand how to rapply for Public Limited Company.
The public limited company is also governed under the company's Act 2013 and the Companies Incorporation Rules, 2014. A Minimum of 7 shares holders and 3 directors are required to start a public limited company. It is more suitable for generating funds from the public at large by issuing IPO's and getting listed at the stock Market. Public limited company follow strict regulatory guidelines from SEBI and under Companies Act 2013 as public money is involved in the company.
A Public limited company has a separate legal entity. It owns the name, act under the name and has a seal of its own and its assets are sperate and distinct for those of its member.
The privilege of limited liability for business debts is liability of a member as shareholder extends to the contribution to the capital of the company up to the nominal value of the shares held and not paid by him.
Shares of a company limited by shares are transferable by a shareholder to any other person. Filing and signing a share transfer form and handing over the buyer of the shares along with share certificate can easily transfer shares.
The life of the Company is not dependent on the life of its founders or its members. Even if the members, for that matter even all members, become bankrupt/insolvent, the company remains unaffected.
A company can issue debentures, secured as well as unsecured and can also accept deposits from the public, etc. Even banking and financial institutions prefer to render large financial assistance to a company rather than partnership firms or proprietary concerns.
Unlike private limited company, there is no restriction on the public limited company related to maximum number of members.