what do you mean by government company? discuss its feature Merit and demerit
Answers
Answer:
Government company has many benefits they don't need any chances to make and normal people don't have any right to ask them I know only this thank you
Answer:
If Central or any State Government holds majority of paid up share capital (not less than 51%) in any company, it is called a Government Company. They are incorporated under the Companies Act, 1956. They are better than Departmental organizations because they enjoy more flexibility.
Explanation:
Merits of Government companies-
1. It is easier to form a government company.
2. It enjoys flexibility and autonomy in functioning. It is run with a commercial outlook and can take decisions to suit the changing needs of the business.
3. It can attract foreign capital and investment, e.g. HMT, BHEL etc.,
Drawbacks of Government companies-
1. Lack of autonomy is a serious drawback of government companies. It is subject to the interference of the Minister and bureaucrats who run the department.
2. There is less freedom and flexibility. It cannot modify its business or change its policies and practices in tune with the changes in the environment.
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