|
Answer» 1. Legal entity: - Being an artificial person, a joint stock company has its own separate legal entity independent of its investors.
- This means a company can own property, enter into contracts, it can sue and can be sued by others.
2. Perpetual existence: - As per the law, a ‘company’ is separate from its investors. So, it is not affected by the death or insolvency of the members.
- A company can be brought to an end only through liquidation procedure.
3. Divison of capital in small fractions: - If for a public company, the capital to start the company is raised from the public in the form of shares.
- The company asks the public to apply for purchasing shares of the company or in simple words ‘purchasing a share’ in the company.
- People buy company’s shares from stock market and become shareholders. The company than starts its business with the share capital i.e. fund raised by selling the shares.
|
