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Distinguish between the following:

Partnership Firm and Joint Stock Company.

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Partnership Firm Joint Stock Company
Meaning Partnership firm is controlled by two or more persons called as partners. Joint Stock Company is an incorporated voluntary association created by law, having an independent legal status, owned by shareholders and managed by Directors.
Act Partnership firm is governed by Indian Partnership Act, 1932. Joint Stock Companies are governed by Indian Companies Act, 2013.
Membership Minimum two partners and Maximum 50 partners. Private company Minimum – 2 Maximum – 200Public company Minimum – 7 Maximum – No limit
Liability The liability of partners is unlimited, joint and several. The liability of shareholders is limited. Up to the unpaid amount of shares held by them.
Ownership & Management Partners are owners and managers of the firm. Joint Stock Company is owned by shareholders of the company and managed by Board of Directors.
Formation The formation is simple and less costly. Only an oral or written agreement is needed between partners. Formation of a Joint Stock Company is difficult, costly and time-consuming.
Stability A partnership firm does not enjoy a stable life. Life of the firm is affected by death, insolvency or lunacy of even one partner. Joint Stock Company has a long and stable life. It has perpetual succession. Life of the company is not affected by death, insolvency or lunacy of any member or Director.
Registration Registration of a partnership firm is optional. It is compulsory in the State of Maharashtra. Registration of a Joint Stock Company is compulsory.
Legal Status A partnership firm has no legal status that is distinct from its members. A Joint Stock Company has a separate legal status.
Transfer of Shares A partner can transfer his share only with the consent of other partners. Shares of a public company are freely transferable.
Authority of Members A partner has implied authority. He is an agent of the firm. A shareholder has no implied authority.
Winding up A partnership firm can be easily dissolved. There are not much legal formalities for winding up the firm. A Joint Stock Company can be dissolved only by the court. A proper procedure has to be followed for dissolving the company

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