When two or more than two persons are interested to share their profit and liability and register their business entity under the Companies Act, 2013, it is called a Private Limited Company. As per Sec 2(68) of the Companies Act, 2013, a private Company means a company, which has such minimum paid-up share capital as may be prescribed and which by its articles provides the following.
- Restricts the right to transfer its shares
- Except in the case of one-person company (OPC), limits the number of its members to two hundred excluding present and past employees who continue to be the members of the company.
- Prohibits any invitation to the public to subscribe any securities of the company.
Key features of a private limited company
- Minimum no of Members is Two and maximum should not be more than 200
- At least Two directors
- The Name of a private limited company must end with the word “Private Limited”