In non-technical language, a public company affects the fate of larger number of people. As such, operations of public limited companies are subjected to a close control in the form of compliance to the various provisions of Company Act, 1956. A public limited company is characterised by the following features:
1) Minimum number of shareholders is 7 and there is no restriction on the maximum number of shareholders.
2) Public limited company can freely approach public in general for subscribing to the shares and/or debentures of the company.
3) The shareholders of a public limited company can freely transfer their shares to any other person. As such, shares of only a public limited company can be listed on the stock exchange.
4) A public limited company needs to have a minimum paid-up share capital of Rs. 5 Lakhs or any higher amount as may be prescribed.
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