Introduction Company is defined as the group of people working together to accomplish a common goal or objective.

Its main features are that it is created by law, has a separate legal entity, with limited liability, having perpetual succession, with transferability of shares, having common seal and which can be sued under the law in the event of breach of contract. It is also found with one man company feature having one persons dominating role. It is managed and controlled by the proprietor of the company. There are circumstances under which the corporate veil will be lifted they are: i) under express statutory provisions and ii) under judicial interpretations There are various kinds of companies according to their nature and characteristics which are categorized according to their incorporation, liability and control. Companies on the basis of incorporation include statutory and registered or incorporated company. Companies on the basis of liability include company limited by shares, company limited by guarantee and an unlimited company. Companies on the basis of control include Government Company and non government company, foreign company and domestic company and holding and subsidiary company. A license is to be obtained by the company from Central Government and it is granted if the company aims at the promotion of commerce, art , science, religion, charity or for any other use, to use its profit for the promotion of the goods and services and it prohibits the payment of dividend to its members. Section 11 of Company Act says that no company, association or partnership consisting of more than ten persons for the purpose of carrying on the business of banking and more than twenty persons for the purpose and carrying on any other business shall be formed unless it is registered as a company under this Act or is formed in pursuance of some other Indian law. This section does not apply to Joint Hindu Family, Stock Exchange and nonprofit earning associations. An illegal company or association can lead to personal liability for any loss, not bound under the company law or act, no suit can be filed for partition, dissolution or for taking account, it cannot enter into any contract and it cannot be cured even by reducing the number of members. Summary

Definition of a company: The term 'company' means a group of people working together for some common object or objects. The purpose for such group to associate are different but the term 'company' is normally set aside for those linked with economic purpose means to work for the profit motive. The term company as defined by Lord Justice Lindley as follows: "By a company is meant an association of many persons who contribute money or money worth to a

common stock and employ it in some trade or business, and who share the profit and loss (as the case may be) arising there from, The common stock so contributed is denoted in money and is the capital of the company. The persons who contribute it, or to whom it belongs, are called members. The proportion of capital to which each member is entitled is his share. Shares are always transferable although the right to transfer them is often more or less restricted." A company is a corporate and legal entity. It is an artificial person created by law It has a common seal and perpetual succession. Main features of a company: A Companies Act has special features which differentiate it from the other forms of organizations. The main characteristics of a company are as: 1) It is the creation of Law 2) It has a separate Legal Entity: 3) It has a limited liability: 4) It has a perpetual succession: 5) Transferability of Shares: 6) It has a common seal 7) It may sue or be sued under the Company Law. One man Company: A company in which a single person owns the whole, or practically the whole, of the share capital is termed as 'one-man Company. There may be other acquaintances, but they may be his relatives, friends or nominees. This central person is designated as the managing director of the company and fully controls the company. It has all the benefits of the corporate status and limited liability of the company. Though only one person controls the whole functioning in a company and also enjoys the legal status. Lifting the Corporate veil: A company has a separate legal entity self-determining and unusual from its members. In fact, a company is an involvement of personnel and such personnel are the real favorable owners of the corporate belongings. As a result of this separate legal entity, the company enjoys a variety of rewards. But when the company starts with the corporate veil for improper conduct, or to protect fraud or to justify wrongs, the law disregards the corporate veil and appears at the persons behind and treats the company and its members as similar personnel. The corporate veil is said to be lifted when the court pay no attention to the company and concerns in a straight line with the members of the company. Prof. Gower has experienced that when the law disregards the corporate entity and pays regard instead to the individual members behind the legal facade, it is known as lifting the veil of corporate personality."

The powers of the court should lift the corporate veil is purely optional. The court will lift the corporate veil when it will be in the public interest. The conditions and cases in which the corporate veil will be lifted can generally be classified under the following two heads: 1) Under express statutory provisions, and 2) Under judicial interpretations.

Distinction between company and partnership: Company and a partnership firm are different from each other on the basis of their formation, nature of liability, membership. legat status, management, nature and transferability of shares, perpetual succession, and various statutory requirements which are required for the companys functioning but not for the partnership firm. A company is governed by the Companies Act, 1956, and partnership is governed by the Indian Partnership Act, 1932. Kinds of companies: Companies can be divided into various categories according to the nature of incorporation, type of liability, and nature of control. According to the nature of incorporation includes statutory company, chartered company, registered or incorporated company. The companies on the basis of liability are companies limited by shares, companies limited by guarantee and unlimited company. On the basis of control, the companies can be classified as government company, foreign company, holding and subsidiary company. Association not for profit: Under Section 25, Central Government can allow a company to ru n without using the words limited or Private limited if and only if they are running the company not for profit motive and also satisfies that the association will promote commerce, art, science, religion, charity or any useful subject to the public in general. Also it will share its profit for promoting its aims and objectives and does not share any dividend with their members. Illegal Associations: A company or a group which is formed with more than ten members such as in the case of banking or more than twenty members in any other business and are not registered under Companys Act 1956 is called an illegal association. But under section 11, Joint Hindu Family, Stock Exchange and non-profit earning associations are exempted