Notes On Private Company Vs Public Company:

1. Minimum Number of Members:

 The minimum number of members required to form a private company is two.

  But, in case of public company it is seven

2. Maximum Numbers of Members:

 The maximum number of members of a private company must not exceed 50.

  But, in case of public company there is no such limit or ceiling.

3. Minimum Number of Directors: :

 A private company must have at least two Directors.

  But, a public company must have at least three directors.

4. Transfer of Shares:

 In a private company, the right to transfer shares is governed by the Articles of Association and the transfer of requires prior permission of the Board of Directors.

  But, in case of public companies, the shares can be transferred without any restrictions.

5. Public Subscriptions:

 A private company, by its Articles of Association prohibits any invitations to the public to subscribe for any shares or debentures of the company.

  But, public company can invite public for the subscription of its shares and debentures.

6. Commencement of Business:

 A private company can commence its business immediately after getting the Certificate of Incorporation.

  But, a public company can commence its business only after getting the Certificate of Commence of Business.

7. Issue of Prospectus:

 A private company need not prepare and file a "Prospectus" or "Statement in lieu of Prospectus" with the Registrar.

  But, a public company is required to prepare and file with the Registrar "A Prospectus" or "Statement in lieu of Prospectus."

8. Issue of Deferred Shares:

 A private company can issue deferred shares with disproportionate voting rights.

  But, public company cannot issue deferred shares.

9. Allotment of Shares:

 A private company can proceed to allotment of shares without having to wait for minimum subscription.

  But a public company cannot allot shares without raising the required minimum subscriptions.

10. Statutory Meeting:

 A private company is not required to hold statutory meeting

  But a public company is required to holds statutory meeting after one month and before six months from the date of obtaining of obtaining the Certificate of Commencement of Business.