Q11: How a Joint Stock Company is incorporated? (2004)
Ans. Before a company can come into existence as a legal entity it must be registered with the registrar of joint stock companies, and in this connection of the following steps are taken:
a) FILLING THE DOCUMENT:
The following documents are to be filed with the registrar of the joint stock company:
i. Memorandum of association
ii. Articles of association
iii. Notice of situation of registered office
iv. A list of persons who agreed to act as directors with the written consents
v. A declaration signed by the secretory of the company that the requirement of the law have been duly complied with
vi. A contact signed by each director to take from the company and pay for his qualification shares
b) REGISTERATION FEES:-
The above documents should be accompanied with registration fees.
c) CERTIFICATE OF INCORPORATION:
The registrar will securitize these documents, if he is satisfied all the papers are in order he will enter the name of the company in the register maintained by him and will issue a ‘’Certificate of Incorporation’’. A private company may commence the business immediately after the certificate. In the case of a public limited company the issue of certificate does not empower the underrating to commerce business. But the public limited company will further have to submit the following documents to the registrar:
a) A copy of prospectus or a statement in line of prospectus.
b) Allotment of shares after the minimum subscription is rendered a return of allotment is filled.
c) A declaration that any director has paid in cash or the shares which he holds in the some proportions as the public must pay on application and allotment. Upon the receipt of these documents from the public company the registrar will issue the certificate of comments which entitled the company to start business.