Examine with reasons whether the following statement is correct or incorrect: (i) A private limited company must have a minimum of two members, while a public limited company must have at least seven members.
(ii) Affixing of Common seal on company’s documents is compulsory
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Both are correct.
1.
* You can start a private limited company with a minimum of only 2 members (and maximum of 200), as per the provisions of the Companies Act 2013.
* In order for a company to be public , it should have a minimum of 7 members (maximum unlimited).
2.Company uses Common Seal as its Signature.
Companies Act, 2013 provides that, the company shall have a Common Seal from the date of its incorporation. However, Companies Act, 2013 does not describe the form, mode of affixing Common Seal or its custody etc.
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