Company Law Assignment Sample
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Added on 2020-07-22
Company Law Assignment Sample
Added on 2020-07-22
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COMPANY LAW
Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................11.1 Corporate personality as well as doctrine of lifting veil.......................................................11.2 Pros and Cons of incorporation.............................................................................................21.3 Legal obligation of promoters as well as legal contracts regarding pre-incorporation.........31.4 Legal process of registration of business..............................................................................4TASK 2............................................................................................................................................42.1 Requirement of Memorandum for partnership firm..............................................................42.2 Contract consists Article of association................................................................................52.3 Doctrine of ultra virus...........................................................................................................62.4 Contents of prospectus..........................................................................................................6TASK 3............................................................................................................................................73.1 Various types of capital.........................................................................................................73.2 Law on issue of share and dividends.....................................................................................83.3 Law of capital maintenance..................................................................................................9TASK 4............................................................................................................................................94.1 Duties and power of directors in different organizations......................................................94.2 Different types of company meetings ans their rules..........................................................114.3 Protection of interests of minority shareholders.................................................................114.4 Rights of shareholders as well as debenture holders...........................................................124.5 Rights of liquidation............................................................................................................12CONCLUSION..............................................................................................................................12REFERENCES..............................................................................................................................13
INTRODUCTIONCompany is stands for concerning companies as well as other business organizations. Itconsists various types of rules, regulation and policies which are imposed on firms. Every entityhaving separate legal entity, perpetual succession and common seal. Directors play significantrole in every firm as they are responsible for overall operations. Members hold ownershipthrough purchase shares equal to nominal value. They have to fulfil requirement of every firmwhich is mentioned under provision of law (Sealy and Worthington, 2013). Memorandum ofassociation and Article of association are different document which needs to be maintain byevery entity. As it is compulsory procedure for them which is mentioned under law. Throughsuch legal documents legal authorities are able to protect interest of investors and creditors.Doctrine of ultra virus stands for it is process which is opted by corporation beyond the scope oftheir powers.TASK 11.1 Corporate personality as well as doctrine of lifting veil.Corporate personality is considered as principles of company law. Every business entityhaving perpetual succession and common seal. The legal structure of firms are not depends onexistence of directors. It has independent legal existence which is separate from its directors,creditors and shareholders. Companies are able to done transaction with their own name. Noother firms having power to use name of another (Dignam and Hicks, 2011). For this purposeowners are bound to registered name in order to protect interest of entire firm and maintainperformance of members as well. They have to fulfil legal obligation which are imposed onthem. They have to focus on rules and regulation in order to maintain smooth functioning ofbusiness. There are two types of corporate personalities name called limited liability (Public) andunlimited liability (Private). In such entity, liabilities are imposed on its members (Cahn andDonald, 2010). In public firm members have to pay equal to shares which are hold by them equalto their nominal value of shares. On the other hand, in case of unlimited liabilities, membersbound to pay entire liability which are imposed on them.
Piercing of corporate veil if the important doctrine which is mentioned under companylaw. It is opted when shareholders are responsible for obligations of firm. Through this concept,members are able to identify actual financial position of company in international market andmaintain their performance as well. At6 the time of lifting of corporate veil, it only means thatcourt assuming that entity conduct fraud, try to avoid liability and obligation which arementioned under provision of law. Case: LIC of India v. Escorts Ltd.In this case it has been stated that, after Bhopal gas leakdisaster it is compulsory. Lifting of corporate veil is important for companies in order to identifytheir actual financial position.1.2 Pros and Cons of incorporation.Incorporation is the complicated process which include creation of legal entity. Personwho connected with firms are called as members. Person ho purchase shares of such companyare known as shareholders. Owners are bound to follow rules and regulation which imposed onthem. At the time of incorporation of firm various types of legal obligation has been create onowners which needs to be fulfil by them (Kershaw, 2012). Through capital of firm can be raiseand receive different types of advantages related to payment of tax. But sometimes they have topay double tax which is considered as disadvantage for them. Some advantages of incorporation as as aligned below-Raising capital- Incorporation is stands for that owner is serious regarding his businessenterprise. Through this, they are able to sell shares in public and raise capital (Wild andWeinstein, 2013). Large number of people invest amount in company in order to hold shares andreceive dividend for the same. Owners have to focus on financial resources and responsible touse effectively use such resources.Transfer ownership- After incorporation of business, members can transfer theirownership. It can be conducted through fairly and simply selling stock. There is no restrictionimposed on firms.Tax benefits- There are large number of companies which enjoy lower tax rates such aspartnership as well as sole proprietorship firm. Furthermore, payment of tax is considered asadvantage for companies which are imposed on them.
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