Question

What are the Features of Government company? (Any 5)

Describe the features of a government company.

Answer 1

1. Incorporation: It is registered or incorporated under the Companies Act, 2013.
2. Separate Legal Entity: It is a corporate body that operates independently from the government. It can acquire property, enter into contracts, and sue and be sued in its own name.
3. Ownership: The government owns it entirely or in part. Where it is partly owned, the government owns at least 51% of the entire share capital.
4. Management: The company is controlled by a Board of Directors appointed by the government and shareholders.
5. Accountability: It is accountable to the relevant ministry, and its annual report is presented to the Parliament or State Legislature.
6. Financial Autonomy: It can borrow money and has more financial flexibility than departmental projects.