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1. |
Difference between preliminary contract and provisional contract |
Answer» \tBasisPreliminary ContractProvisional Contract1.MeaningPreliminary contracts are the contracts, which are made before the formation of the companyThe contracts which are entered by a company after incorporation but before it is entitled to commence business are provisional Contracts2.Enforcement of contractNeither the company can sue nor can it be sued to enforce the preliminary contracts.Can be enforced only on receiving certificate of Commencement of Business.3Contracts related toPreliminary contracts may relate to property which the promoters desire to purchase for the company or they may be made with the persons whose know-how is vital to the success of company.It is not so with the provisional contracts4Applicable forBoth private and public companyOnly public company\t | |