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Joint Hindu Family Firm |
Joint Stock Company |
(1) Meaning |
In Joint Hindu Family Firm, the Joint Hindu Family conducts business according to Hindu Laws. |
Joint Stock Company is an incorporated association created by law, having an independent legal status, owned by shareholders and managed by Board of Directors. |
(2) Number of Members |
Membership of the firm depends upon the birth and death in the family. There is no limit on membership. |
Private companyMinimum – 2 Maximum – 200 Public companyMinimum – 7 Maximum – No limit |
(3) Registration |
Registration is not required |
Registration is compulsory. |
(4) Liability |
Karta has unlimited liability and Co-parceners have limited liability. |
The liability of shareholders is limited upto the extent of unpaid amount on shares by them. |
(5) Capital |
The whole of ancestral property used as capital. |
The company has huge capital. |
(6) Secrecy |
Secrecy can be maintained within the family. |
Books of accounts have to be published. Business secrecy cannot be maintained. |
(7) Management |
Karta manages the business and he is assisted by coparceners. |
Board of Directors manages the Joint Stock company. |
(8) Government Control |
There is limited government interference. |
There is strict government control. |
(9) Act |
Joint Hindu Family Firms are governed by the Hindu Succession Act, 1956. |
Joint Stock Companies are governed by Indian Companies Act, 2013. |
(10) Formation |
It is comparatively easy to form. |
Formation of a Joint Stock Company is difficult, costly and timeconsuming. |
(11) Legal Existence |
A Joint Hindu Family firm does not have a separate legal existence independent of its members. |
A Joint Stock Company has a separate legal existence. It is distinct from its members. |
(12) Minor Member |
Minors can become a member of the firm. |
Minors cannot become a member of the company. |