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What is the perfect PVT Full Form 2022

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PVT Full Form, PVT Ltd Full Form, Full Form of PVT, Private Limited Company, Private Company, PVT Full Form in Instagram

PVT Full Form | PVT Ltd Full Form:

PVT Full Form
PVT Ltd Full Form

Full form of PVT is Private Limited. The terms private and limited both are related to the company. While, company rises their capital privately then that is called a private limited.

May you hear somewhere the name of companies like; XYZ Private Limited then, that is privately held business organization.

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Private Company | Private Limited Company:

The shares of Private Companies do not trade on Public exchanges while they have shareholders and they issue a stock also they have not issued Initial Public Offering (IPO). Private Companies don’t need to meet the Securities and Exchange Commissions’. The valuations of private companies are more difficult to determine as compare the public Companies.

According to Section 2(68) of Companies Act, 2013; private companies are those companies whose articles of association can restrict the shares transferability. The minimum paid-up capital for private companies is Rs.1 lakh but after an amendment in 2005 the requirement of this capital is removed. Now, any private company can start with any amount.

In the formation of private company, the minimum numbers of partners are needed 2 and the maximum limitation is up to 200 members.

Basic features of Private Company:

Let’s discuss the features that differentiate how private company is differing from other companies.

  • There is no minimum capital is required. Paid-up share capital is require minimum Rs. 1 lakh previously, but now there is ignored.
  • Any private company can start a business with minimum 2 members and maximum 200 members, but if it is a one person company then just one member is enough.
  • According to the Act all the private companies have to include “Private Limited” or “PVT LTD” in their names. For example; if the company name is XYZ then, it write as “XYZ Pvt. Ltd.”
  • As compare to public company, private companies cannot easily transfer their shares to the public. For this reason, stock exchanges do not list private companies ever.
  • According to the Act, private limited company must have minimum 2 directors and maximum 15 directors.
Private Limited Company
Private Limited Company

Types of Private Limited Company:

A private company can also be a one person company, in the term of number of members. While, one or more individuals are own the company; it will divided into some categories. Where, the members of limited by shares are known as shareholders, any individual have whole the liability then it is known as unlimited liability and limited by guarantees are known as Guarantors.

Private Companies Limited by Shares: In this type of private company, the amount of capital is divided into small parts which are known as shares. These shares are introduced with the shareholders. While, private company is limited by shares then, shareholders have limited liability.

Private Companies Limited by Guarantee: In this type of private company, the capitals of partners not divided in the form of shares but the partner introduced with guaranteed nature. They have partners who are guarantors of the liability of company. 

Unlimited Liability: In this type of private company, company has unlimited liability for its partners. In that the personal assets of partner also at risks. While at the time of bankruptcy, individual partners personal assets can be used for pay the company’s debts as well as liabilities.

Advantages of the Pvt. Ltd companies:

  1. In the private limited company, the liability of members would be limited.
  2. Private limited company is a Separate Legal entity from its members.
  3. The shares of shareholders are the transferable to any other person in the private company which is limited by shares.
  4. In that just one person can take legal action against another person’s name.
  5. The private company has perpetual succession that is even continued or uninterrupted existence until it is declared as legally dissolved.
  6. One of the benefit of private company is there is no any kind of pressure for fund or its requirements. Because, previously minimum number of share capital was Rs. 1 lakh but now there is no need.
  7. In the private limited company, there is a limited risk for the personal assets of the partners.

Disadvantages of the Pvt. Ltd companies:

  • One of the limitation of the private company is the number of members cannot expand than 200 in any situation.
  • In the private limited company, there is restriction in the transfer of shares by its article.
  • Private limited company cannot issue prospectus to the public that is another disadvantage of Pvt. Ltd. Company.
  • Private limited companies are more expensive and difficult in the register as compared to Sole Proprietorship.
  • In the private limited company, a minimum of two shareholders are required for a meeting.

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Examples of Private Limited Companies:

  • Lifestyle International Private Limited.
  • DHL Express Private Limited.
  • Kiran Gems Private Limited.
  • Paypal Payments Private Limited.
  • Anand Automotive Private Limited.

Conclusion:

In this article you can learn about PVT full form, private limited company, its features, type’s advantages and disadvantages. We are glad if you like our article and it may helpful for you. We are tried our best to give you clear cut information.

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