A Company is an association of persons who contribute money or money’s worth to a common inventory for a common purpose. It is an artificial person having a corporate legal entity distinct from its members. According to Chief Justice Marshal, a company is a person, artificial, invisible, intangible, and existing only in the eyes of law. It is incorporated or registered under the Companies Act, 2013 or under any other earlier Companies Acts.

One of the primary characteristics is that it is a Body Corporate. It is formed according to the provisions of Law enforced from time to time. Generally, in India, companies are formed and registered under Companies Law. Another significant feature is its Separate Legal Entity. The company is distinct and separate from its members; it can hold and deal with property, enter into contracts, and open bank accounts in its own name.

The liability of the members is Limited. It is limited to the extent of the unpaid amount of the shares held by them. In the case of companies limited by guarantee, the liability is limited to the extent of the guarantee given by them in the event of the company being wound up. The capital is contributed by a large number of persons called shareholders, who are the real owners.

Since it is not possible for all shareholders to participate in management, they elect a Board of Directors as their representative to manage the affairs of the company. Finally, because a company is an artificial person, it acts through a Common Seal which is used as its signature.