Company law

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umesh (Querist)

03 September 2013 what is a company limited by gurantee

and

does it not contain "perpetual succession" characterstic??

Ajay Mishra

Ajay Mishra (Expert)

03 September 2013 Hi

Companies limited by guarantee and having share capital:

Such a company by way of undertaking in its Memorandum of Association restricts the liabilities of its members to a certain fixed amount, for payment of the debts and liabilities of the company in the event of winding up. The members are liable only for the amount contracted before he ceased to be a member or payment of the debts and liabilities within one year after he ceased to be a member. Such companies may also have share capital whenever necessary. In that event, the members will be liable for the amount, if any, remaining unpaid on the shares subscribed by them, in addition to the above guaranteed amount.

Companies limited by guarantee without having share capital:

Companies limited by guarantee without having share capital are exactly similar in nature to the guarantee companies as referred above except that there will be no share capital. The members will be liable, in the circumstance referred to above, to contribute an amount not exceeding the sum specified in the Memorandum of Association.

Yes such class of company have a perpetual succession.

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