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Distinguish Between the Following (1) Co-operative Society and Joint Stock Company. - Organisation of Commerce and Management

Distinguish between the following 
(1) Co-operative society and Joint stock company.

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Solution

Co-operative society and Joint stock company.

Sr.

No.

Basis of Difference

Co-operative Society

Joint Stock Company

1

Meaning

A Co-operative society is a voluntary association of people who come together on the basis of unity and equality to protect and promote their common economic interest. It is voluntary association of individuals for profit having capital divided into transferable shares, the ownership which is the condition of membership.
2

Formation

Formation of co-operative society is comparatively cheaper. Formation of a joint stock company involves many legal formalities. It is lengthy and costly.
3 Motive The main motto of a co-operative is to provide services to members. Profit making is its secondary objective The main motto of a joint stock company is to earn profit. Providing service is the secondary motive
4

Transferability of shares

Shares are not transferable to other members though they can be surrendered to the society Shares are freely transferable in a public limited company. But it is restricted in private limited company to a certain extent.
5

Number of members

A minimum 10 members are required for formation of a co-operative society though there is no maximum limit.

The minimum of number of members are 2 in private limited company and a maximum of 50. In a public limited company, minimum number of members is 7 and there is no maximum limit
6

Voting Rights

The principle of voting is one member one vote.

The principle of voting is one share is one vote.

7

Capital raising capacity

It can raise limited capital since the dividend is fixed and there is no capital appreciation.

It can raise large capital since attractive dividend is paid and there is capital appreciation.

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