Question

Explain the term ‘Company’.

Answer 1

A company is a legally registered association of persons formed under the law, having a separate legal identity distinct from its members. It is managed by a Board of Directors and enjoys perpetual existence, meaning it continues to exist irrespective of changes in its membership. Members contribute capital to a common fund, called the company’s capital, and their liability is usually limited to the value of their shares. Companies can carry out business activities, own assets, enter into contracts, and sue or be sued in their own name. Examples include Tata Motors, Reliance Industries, and ICICI Bank.