The above definition does not reveal the distinctive characteristics of a company Perhaps the clearest description of a company is given by Lord 36stie Lindley "By a company is meant am association of Amy persons web contribute money or money's worth to a common stock and employ it in some trade or business, and who share the profit and loss (as the case maybe) arums thereof ohm. The common stock so confronted is denoted m money and is the capital of the company. The persons who contribute it, or to whom it belongs, are memoirs. The proportion of capital to which each member is entitled is his share. Shares are always transferable although the right to transfer them is often more or: less restricted”
A more comprehensive legal defamation of a company giving its mama essentials has been given by Hauey....’’A c ompany IS an incorporated association which is .111 artificial person created by law; having a separate entity, with a perpetual succession and a common seai."
:A company, thus, may be defined as an incorporafedassociabon which on artificial legal person, having an independent legal entity, with a perpetual succession, a common seal, a common capital comprised of transferable shares and carrying limited liability
CHARACTERISTICS OF JO! NT STOCK company An examination of the above den nations reveals the following essential 'characferisbcs of a company’

1. Incorporated association. A company must necessarily the incorporated or registered’ under the prevalent Compares Act. Registration' creates a joints stock company and it is compulsory for all associations or partnerships, having a membership of more them ten in ban and, more than hFenfy,in any other trading activity, formed for carping on a business with the object of earning profits.
INCORPORATION OF A COMPANY 39
2. Artificial legal person. A company is an artificial legal person in l the sense that on the one hand it is created by a process other than natural birth and does not possess the physical attributes of a natural person, and on l the of her hand, it is clothed with many of the rights of a natural person. It is immiscible immortal (law Dine can dissolve it) and exists only in the eyes of law. It has no body, no soul, and no conscience, neither is it subject to the l imbecilities of the body it is because of these physical disabilities that a company is called an artificial person. But it cannot be treated as factious entity because is really exists. As a rule, a company may acquire mad dispose l of property it may enter into contracts through the agency- of natural persons, l it may be fined for the contravention of the pa Missions of the Companies Act Thus for. most lesaalprrr ores a company is a legal person just like a natural person, who has rights and due ins at shirr, it may be said, therefore, that a company-being an an if al legal pelted An do eversthmg like a mantra I person except of course- that it cameo Me oath cannot appear m its own person in the court (must be represented by counsel), cannot be sent to Jail, cannot prattle - a learned profession lake lad or medicine. nor can it marry or die orca.
3. Independent legal entity A company is a legal person having a justice personality entirely district from and independent of the individual persons who are for the time being its members (Kathie are Industries Ltd. vs. C G of Evacuee proper ah . it has the right to Own and transfer the tide to property in any way it likes. No member can either individually or jointly claim Amy ownership rights in the assets of die company during its existence or in this winding up (,lifers B ,r Gander vs. The Commissioner of Incomer Tax). It can sue and be sued in its own name by its members as well as outsiders. Creditors of the company are creditors of the company alone and they cannot directly proceed against the members personally
Itch person. A company is not merely the sum total of its component members, but it is something superadded to them in mathematical language it may be defined as knelt person, where n stands for the total number of members and the I the person for the company itself. Even if a shareholder owns virtually the whole of its share, die company is a separate legal entity in die eves of law as distinguishing Freon such a shareholder Tulips principle was judicially recognized by the House of Lords in the famous case of Salon ion vs. Palomar & Co. Ltd.