How to Trademark a logo for businesses in India?
28 Jan, 2026
By Online Legal India
Published On 28 Jan 2026
Category Company Registration
The Definition of a Company in law determines a separate legal entity. It is mainly created by individuals to engage in business entities. A company is considered as an artificial legal person. So, a company has its own rights to own property. A company can incur liabilities in its own name, independent of its owners. Thus, it helps to keep the personal assets safe for an individual. In this blog, you will learn about the definition of a company under the Companies Act, 2013.
A company refers to a legal entity created by a group of people to deal with business activities. It is considered as a separate legal entity. This means a company has its own rights and responsibilities. They are different from its owners. Thus, it acts as a separate artificial person by law. They can own property, enter into contracts, and so on. The owner has the benefit of limited liability. The various types of companies are managed by the Companies Act 2013.
As per the Section 2(20) of the Companies Act, 2013, a definition of a company specified as:
"A company incorporated under this Act or under any previous company law". This means a business is registered with the government. It can be registered under the current Companies Act, 2013. It can also be registered under the old company rules. A company can be said as a formal legal entity as per the law. The "company" is a term that comes from the latin words ‘com’ which means together. The word ‘panis’ means bread. So, it means a group of people joined together for a common purpose. Officially, it means a registered business identified by Law. They have the right to:
a) Enter into Contracts
b) Owning Property
c) Conducting business activities in its name.
Thus, the Indian Law also recognizes a company as an "artificial person".
Justice James
He states it as "A company is an association of persons united for a common object.” In my point of view, a group of people who have the same purpose forms a company.
Professor Haney
It is defined as:
“A company is an artificial person created by law, having a separate legal entity with perpetual succession and a common seal.” In my point of view, officials create a company that acts as a legal person. It has its own rights and responsibilities.
The definition of a company has several features. The key features can include:
Separate Legal Entity
A company has a unique legal identity that is different from their members. It has the right to:
a) Own property
b) File lawsuits in its own name
c) Sign contracts, and so on.
This helps to keep personal assets of its shareholders are safe. The Salomon case created this concept. This confirms that the assets and liabilities of a company is different from its members. So, the shareholders has the limited liability. This helps to simplify the business activities.
Limited Liability
Shareholders of a company are responsible for the unpaid values of their shares. This means a limited liability. It confirms that their personal assets remain protected. The company will also protect this if it faces loss or financial issues.
Artificial Legal Person
An Indian law created a company as a legal entity. So, the law states it as an artificial legal person. A company has its own roles and responsibilities of a natural person. It includes:
a) Enter into contracts
b) Own property or assets
c) File lawsuits in its own name
d) Initiate or face legal action
e) Hiring Employees
f) Paying taxes, etc.
Thus, it cannot perform on its own but works through its Board of Directors.
Perpetual Succession
The changes in the membership do not affect a company's existence. The changes can include:
a) Death
b) Insolvency
c) Resignation of Shareholders or directors
d) Retirement of its members.
Thus, a company keeps running until someone officially dissolves it.
Transferability of Shares
In case of a public company, investors can easily buy and sell shares. This gives liquidity and flexibility to investors or shareholders. In contrast, in a private company, the Articles of Association restrict the transferability of shares (AoA).
Common Seal (Optional)
A common seal of a company is used as their official signature on documents. It is not compulsory, but it is optional under the Companies Act, 2013. So, several companies use it as their official purposes.
Representative Management
A Board of Directors handles companies. The shareholders elect it. It maintains professional and efficient management for business activities. Directors also see it managing day-to-day operations.
Voluntary Association for Profit
Individuals or entities voluntarily form a company. The goal is to earn profit from the business. The company shares the profits with shareholders. The company shares it as a form of dividend. Most companies are formed for profit, except Section 8 companies which are formed for charitable purposes.
The Companies Act, 2013 categorizes companies in India. The definition of a company depends on incorporation, ownership, control and liability.
Listed below are the types of companies with primary categories:
1) Basis of Incorporation
It includes:
a) Chartered Companies
A royal charters created these type of companies. It is not exist in India.
b) Statutory Companies
The Act of Parliament or state legislature was formed statutory companies. For Example: Reserve Bank of India (RBI).
c) Registered Companies
These types of companies are created under the Companies Act, 2013. It is considered as one of the most common business entities in India.
2) Based on Liability
It contains:
a) Companies Limited by Shares
Shareholders are only responsible for the money they still need to pay for their shares.
b) Companies Limited by Guarantee
Members agree to pay a certain amount if the company is closed.
c) Unlimited Liability Companies
The members has the benefit of unlimited liability. This means their personal assets can be used for the company’s debts.
3) Basis of Number of Members
It generally includes:
a) Private Limited Company:
The maximum 200 members are required to run a business. This type of company keeps its ownership private. This means it cannot sell shares to the public. The company need to include the “Private Limited” in its own name.
b) Public Company
There is no limit on the list of members. A company can issue shares to the public for fund raising.
4) Basis of Control
a) Holding Company
A company has most of the control over another company's Board or share capital.
b) Subsidiary Company
A holding company handles a subsidiary company.
5) Basis of Ownership:
a) Government Company
A company that is owned by the government with at least 51% of the shares.
b) Non-Government Company
A company that is run and managed by private people or groups.
c) Foreign Company
A company based outside India but working in India.
d) One-Person Company (OPC)
In an OPC, one person can manage and run a company. It is formed according to the Companies Act 2013. The company also has the benefits of limited liability and ease of management.
Listed below are the steps to start a company in India:
Step 1: Choose the Right Business Structure
This is the first step to start a company. You must choose the correct structure as per your needs. The common types of companies can include:
a) Private Limited Company (Pvt. Ltd.)
c) Limited Liability Partnership (LLP)
d) One-Person Company (OPC)
e) Sole Proprietorship or Partnership
Step 2: Reserve a Company Name on the MCA Portal
This step allows you to choose a unique name for your company. The name must be followed by the Ministry of Corporate Affairs (MCA) guidelines. Then, you need to submit a RUN (Reserve Unique Name) application. In the MCA portal, it can be submitted. Here, you also have the right to give two names. This will help to increase the chances of approval.
Step 3: Get a Digital Signature Certificate (DSC)
The proposed directors and shareholders must digitally sign all the company documents. They can sign it with the help of a Digital Signature Certificate (DSC).
Step 4: Apply for Director Identification Number (DIN)
All directors must get a Director Identification Number (DIN). They can get it from the official MCA portal.
Step 5: Prepare Documents for Company Registration
Next, you need to prepare necessary documents for company registration. The documents can include:
a) Memorandum of Association (MOA)
b) Articles of Association (AOA)
c) Identity Proofs and Address Proofs
d) Proof of Registered Office Address
Step 6: File the SPICe+ Form on the MCA Portal
You must fill out and complete the SPICe+ form. It means Simplified Preformat for Incorporating Company Electronically Plus form. This form contains the various services. The Services can include:
b) PAN (Permanent Account Number)
c) TAN (Tax Deduction and Collection Account Number) allotment
d) GST registration.
Here is the process to fill it:
1) You need to go to the MCA portal. Then, fill out the SPICe+ form online.
2) Next, you must attach the MOA, AOA, and other documents.
3) Make a payment of a registration fees
4) Then, you must submit your application form for approval.
Pay the prescribed registration fees.
Step 7: Get PAN, TAN, and GST Registration
As an applicant, you can apply for:
a) PAN (Permanent Account Number)
b) TAN (Tax Deduction and Collection Account Number) for the company
c) GST registration. It is required in case the business meets the turnover threshold. If they engaged in interstate trade.
Step 8: Receive Certificate of Incorporation
Once it gets verified by the MCA, you will get a Certificate of Incorporation (COI) for your company. The certificate consists of:
a) Corporate Identity Number (CIN).
b) Official approval of the company name.
c) Legal recognition to commence business operations.
Step 9: Open a Company Bank Account
Next, you need to open a bank account in your company's name. You can use it for all your financial transactions.
Step 10: Comply with Post-Incorporation Formalities
As an applicant, you need to follow several post-registration requirements. For this you need to:
a) Conduct the First Board Meeting by 30 days of your company incorporation.
b) You must give share certificates to every shareholders.
c) Handle statutory and records.
d) Next, you need to submit the annual returns and financial statements from the MCA website.
e) Get a professional tax registration if applicable.
Conclusion
The definition of a company in law help us to know how it is organized, what it does, and how it works. Companies are seen as a separate legal entities as stated by the Companies Act, 2013. A company has its own rights and responsibilities for a business purpose. This means that the company is different “Person” among its members. It has the features like limited liability, perpetual succession, etc. If you still have a query about it, get in touch with Online Legal India.
FAQ
Q1. What is the legal definition of a company?
As per the Section 2(20) of the Companies Act, 2013, a definition of a company defined as “a company incorporated under this Act or under any previous company law”. It is also said as an artificial legal person which is created by law. A company can able to enter into contracts, conducting business activities in its own name and owning property. A company may have a common seal, which is optional under the Companies Act, 2013.
Q2. What are the key features in the definition of a company?
Here are some key features in the definition of a company:
Q3. What is meant by "Separate Legal Entity" in the definition of a company?
The “Separate legal entity” means a company is seen as a separate person by the law. It is different from its owners and managers. This was made clear in the important case of Salomon v. Salomon & Co. Ltd. It states that the company does not act on behalf of its owners.
Disclaimer
This article is for informational purposes only and does not constitute legal advice. Online Legal India is a digital platform. If you require legal assistance, we strongly recommend consulting a qualified lawyer or law firm.
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