Distinguish between Joint Stock Company and Partnership.
| Partnership Firm |
Joint Stock Company |
| 1. Formed by an agreement |
Formed by registration |
| 2. Governed by Partnership Act 1932 |
Governed by the Companies Act 1956 |
| 3. Registration is optional |
Registration is compulsory |
| 4. It has no separate legal existence |
It has separate legal existence |
| 5. It does not possess continuous existence |
It has perpetual existence |
| 6. Minimum number of persons required is two |
Minimum number of persons required is seven (2 in Private company) |
| 7. The liability of partners is unlimited |
The liability of shareholders is limited |
| 8. All partners can take part in the management |
All shareholders cannot take part in the management |
Partnership Firm Joint Stock Company
1. Formed by an agreement Formed by registration
2. Governed by Partnership Act 1932 Governed by the Companies Act 1956
3. Registration is optional Registration is compulsory
4. It has no separate legal existence It has separate legal existence
5. It does not possess continuous existence It has perpetual existence
6. Minimum number of persons required is two Minimum number of persons required is seven (2 in Private company)
7. The liability of partners is unlimited The liability of shareholders is limited
8. All partners can take part in the management All shareholders cannot take part in the management
