Manoj kashera (Articleship) (64 Points)
28 September 2011I can't properly understand why the people create pvt.Ltd Co's instead of propritership concerns.
i think there is great benefit enjoying by them so that they can chose Co's form of business, even that there is more legal Requirment to follow by Co's and it is more expensive one.
Please sort out my problem
I am very thanks to all of you
devendra
(company secretary)
(59 Points)
Replied 28 September 2011
The reason is that in case of propritership, his liability is unlimited whereas in pvt, ltd companies it is limited to the extent of his capital contribution. in former case his personal properties will be at the stake in case of business liabilities. hence pvt. cos. are prefered.
Also to add further on above, Companies are seen with much reputation and trust in the eyes of public as they are always on the watchlist of strict regulatory bodies like ROC, IT Deptt., MCA, etc. Therefore people will always find it more comfortable to do business with companies as they considered more reliable.
Since company is contemplated as a separate legal entity from its owner hence it can enjoy full rights what an individual does ie. acquire n hold property in its name, sue n be sued in its own name, etc.
if one wants to grow big and expands his business across borders than Company is the ideal form of business. For small business house proprietership is preferable.
Manoj kashera
(Articleship)
(64 Points)
Replied 29 September 2011
thanks to all for your valuable comments. it gives me lots of relaxation
CAclubindia
