Member for pvt. ltd. company

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vishwas gajanan chandhaikar (Querist)
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14 March 2012 Dear All,

As per Section 3(1)iii of the Companies Act, 1956 A Private Limited Company has a Maximum 50 No. of members.

My question is

Does Preference Shareholder includes in counting limit of 50 No. of Members.

Thanks
Vishwas

Ajay Mishra

Ajay Mishra (Expert)
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14 March 2012 Hi

If you read the definition of private company given in 3(1) (iii) of the Companies Act, 1956 says that the minimum paid up capital should not be less than one lakh rupees it means paid up capital includes equity shares and preference shares for constituting paid up capital.

On the basis of above interpretation the maximum number of 50 members includes preference shareholders along with equity shareholders.

Regards