Business Startup

Partnership

Partnership Firms in India are governed by the Indian Partnership Act, 1932. As per Act: "Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all”.

Private Limited Company

These are closely held businesses usually by family, friends and relatives. Private companies may issue stock and have shareholders. However, their shares do not trade on public exchanges and are not issued through an initial public offering. Private Limited Companies are those types of companies where minimum number of members is two and maximum number is fifty. A private limited company has the limited liability of members but at the same time it has many characteristics as those of a partnership firm. A private limited company has all the advantages of partnership namely flexibility, greater capital combination of different and diversified abilities, etc., and at the same time it has advantages of limited liability, greater stability and legal entity. In this sense, a private limited company stands between partnership and widely owned public company. Identifying marks of a private limited company are name, number of members, shares, formation, management, directors and meetings, etc.Shareholders may not be able to sell their shares without the agreement of the other shareholders.

Public Limited Company

A public limited company is a company whose securities are traded publicly on the stock exchange. These types of companies are tightly regulated and must publicly disclose the truth about its financial position so that investors can determine the worth of their stock Public Limited Companies are those types of companies where minimum number of members is seven and no maximum limit.

One Person Company

One person company is a new concept in India which has been introduced by the companies act 2013. In the old Companies act 1956 a minimum of two directors and shareholders were required to form a private limited company. However in case of a One person company, only 1 person is required who can be a shareholder as well as the Director. Hence the name, One Person Company. Where the person forming the One Person Company has to nominate a Nominee with his written consent who, in the event of death or inability to contract of the owner of the One Person Company, shall come forward and take over the reins of the one person company.

Limited Liability Partnership

The LLP has Separate Legal Entity i.e. the LLP and the partners are distinct from each other. Minimum of 2 partners are required to form a LLP. However, there is no limit on the maximum number of partners. Minimum Capital Contribution of Rs. 100000. The LLP Act does not restrict the benefit of LLP structure to certain classes of Professionals only and would be available for use by any enterprise.

Section 8 Company

The company is said to be a Section 8 Company if it has in its objects the promotion of commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environment or any such other object; It intends to apply its profits, if any, or other income in promoting its objects. It intends to prohibit the payment of any dividend to its members. The company registered under this section shall enjoy all the privileges and be subject to all the obligations of limited companies.

Trust

The origin of 'Trusts' can be traced back to the ancient times when human motivation to do charity and dedicate property for charitable and religious purposes found its manifestation in the form of dharmashalas, annachatras, sadavarts, educational and medical institutions, construction of water tanks and wells, bathing ghats,implanting trees etc. with the emergence of idol worship, endowments for temples and idols came into existence. As per section 3 of Indian Trust Act 1882 “A Trust is an obligation annexed to the ownership of the property, and arising out of a confidence reposed in and accepted by the owner, or declared and accepted by him, for the benefit of another, or of another and the owner” Trivia : This definition has never been amended since its inception.

For discharge of the charitable and/or religious sentiments of the author of settlor of the trust, in a way that ensures public benefit.
For claiming exemption from Income tax U/s 10 or 11, as the case may be, in respect of incomes applied to charitable or religious purposes.
For the welfare of the members of the family and/or other relatives, who are dependent on the settlor of the trust.
For the proper management and preservation of a property.
For regulating the affairs of a provident fund,superannuation fund or gratuity fund or any other fund constituted by a person for the welfare of its employees..

Society

A society is a non-commercial organization, form for the promotion of the object like art, culture, science, religion etc. Associations, clubs or societies are formed to help further these causes because they work on non-profit basis. The need for a legal entity, which could own, possess and manage the funds and assets for achievement of charitable or promotional objects, as laid down by donors, is the result of these endeavours. A society can be formed to achieve this end.

Co-operative society

A co-operative society is an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise. It is another means for forming a legal entity to conduct business besides forming a company. It pools together human resources in the spirit of self and mutual help with the object of providing services and support to members.

The Co-operative Principles under which a co-operative society operates and carries out its business are :-

• Voluntary and open membership.
• Democratic control, one member one vote.
• Autonomy and independence.
• Promoting economic activities.
• Promoting education and information technology.
• Co-operation among co-operatives.
• Concern for the social and ecological environment.