Tag: government organisation

A company is a separate legal entity as distinct from its members. A company is a separate legal entity as distinct from its members, therefore it is separate at law from its shareholders , directors , promoters etc and as such is conferred with rights and is subject to certain duties and obligations.

Government companies are providing goods and services at reasonable prices. Due to this they are able to control the market and can also curb unhealthy business practices.

The Ministry of Corporate Affairs (MCA) is an Indian government ministry.This Ministry is primarily concerned with administration of the Companies Act 2013, the Companies Act 1956, the Limited Liability Partnership Act, 2008 & other allied Acts and rules & regulations framed there-under mainly for regulating the.

A Government company is free from budgetary, accounting and audit controls, applicable to Government undertakings.

Companies Act 1956 was an Act of the Parliament of India, enacted in 1956, which enabled companies to be formed by registration, sets out the responsibilities of companies, their directors and secretaries and also provides for the procedures for its winding.

A government company is an organization where the investment goverment is more than 51% . There by the control and management lies in the hand of the government.

Government companies are exempted from the accounting and audit rules and procedures. The Comptroller and Auditor General of India shall appoint an auditor within a period of one hundred and eighty days from commencement of financial year to hold office till conclusion of the annual general meeting. The annual report is to be presented in the parliament or the state legislature. 

A “subsidiary company” or “subsidiary” of a Government Company would also be categorized as a Government Company provided the Government Company
(i) controls the composition of the Board of Directors; or
(ii) exercises or controls more than one-half of the total share capital either at its own or together with one or more of its other subsidiary companies.

Even if the control referred above is of another subsidiary company of the Government company, the company would still be categorized as a “subsidiary” and hence a government company. Thus, joint-venture companies formed by various Government companies or public sector undertakings are also considered as government companies.

Government Company is a company or an organization in which at least 51% of the paid up share capital is held by the central government or the state government or partly by both central and state government.