Difference between a Private Limited Company and Public Limited Company in India

There are two types of the companies in India limited by shares viz. Private Limited company  and Public Limited Company.  A private company is the one which has a minimum paid up share capital of Rs. 100000 or such higher capital as prescribed by the Companies Act. Its Article of association mentions that the company restricts the right to transfer its shares; limits the number of its members from 2 to 50.

On the other hand, the public company means a company which is not a private company and has minimum of 7 shareholders/subscribers. It has to have a minimum paid-up share capital of Rs. 5 Lakh.

The differences between a Private Limited Company and Public Limited Company has been given  in the following table.

DistinctionPrivate CompanyPublic Company
Minimum Paid-up Capital1 Lakh5 Lakh
Minimum Number of Members27
Maximum Number of Members50No restriction
Transerferability of sharesComplete RestrictionNo Restriction
Issue of ProspectusProhibitedFree
Number of DirectorAt least 2At least 3
Commencement of BusinessImmediately after incorporationOnly after commencement of business certificate is obtained
Statutory meetingNo ObligationObligatory
Quorum2 members5 members
Managerial remunerationNo restrictionCan not exceed more than 11% of Net Profits
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