We have already said about the limited liability in the details. If I tell you that the shareholder invests in a company as much as the percentage of the shareholder’s liability is or can be said that the liability is limited to that. Shareholders have no liability for personal assets. It is applicable to both public limited companies and private limited companies.

These two companies will be able to register on the stock exchange. But in the case of a public limited company there is no limit on the amount of maximum shareholders, so in the case of a public limited company the stock exchange is convenient and in the case of a public limited company the stock transfer is very fast. And in the case of private limited companies, registration can be done on the stock exchange but not as many benefits are available as in public limited companies.

In the case of a private limited company, any decision can be taken very fast. But in the case of a public limited company, it is not possible because there are two or three shareholders or they are in management and they can make a decision very quickly. But in a public limited company there are many independent directors under the board of directors but still there are many SEBI requirements, so the board of directors is completely independent of the shareholder. Even if someone owns 70% of the shares, all the shareholders have to abide by the decision of the board of directors. On the one hand, we want to say that decision making becomes a little slow.

We will say that the private limited company has reached a good scale and its turnover is in crores. And the company that wants to expand its business should be able to meet the requirements of the public limited company. Such a company should be registered as a public limited company.

Or companies that want a proprietary structure just to do business. And for those who are new to startups, it would be best for them to register a private limited company.