Published by: BhumiRaj Timalsina
Published date: 19 Jan 2022
The joint stock company has come into existence over the limitations of sole trading and partnership firms. The major limitations of sole trading and partnership are limited capital and unlimited liability. Such limitations are the main obstacles for large-scale production and distribution of goods and services. A joint stock company is a voluntary association of persons for establishing a business under the company act, 2053. It is a distinct legal person created by law. Its capital is divided into a large number of parts with equal value. Each part is called share. The company collects capital by selling the shares to individuals and organizations.
The following are the meaning of Joint Stock Company:
"A company is an artificial person created by law having a separate entity with a perpetual succession and a common seal." - L.H. Haney
"A joint stock company is an incorporated association which is an artificial person created by law having a common seal and perpetual succession." -Sherlekar
The following are the main characteristics of a joint stock company
The following are the main advantages of a joint stock company: