The word “Company” originates from a combination of the Latin words “Com” and “Pains” meaning “bread.” Originally, the meaning of the word was supposed to refer to a group of people who took their meals together. A company therefore refers to a group of individuals who come together or contribute their finances for a single, common cause, forming a separate legal entity in the form of a company.
In India, laws with regards to companies were recognized under the Companies Act of 1956. However, since the nineties, there has been a change in the manner through which the Indian economy has been functioning. The process of liberalisation, privatisation and globalisation has invited more companies to open up and change the manner in which trade industries have earlier existed.
The laws regarding companies and their affairs were dealt with by the Ministry of Corporate Affairs. After taking a close consideration of the changes, the authorities came up with a new amended law that could be suitable for the newer times – the Companies Act, 2013. The legislation was enacted to regulate the manner in which companies functioned in India. Some of the other laws that also help in the regulation of the same are:
• The Limited Liability Partnership Act, 2008