Question

Private limited company is a happy marriage between partnership and a limited company. Why?

Answer 1

Dear student,

A private limited company comprises of positive characteristics of both, public company and partnership form of business. It inhibits the feature of limited liability and personal control from a partnership form of business. At the same time, it also inhibits the features of perpetual succession, separate legal entity, etc from a public limited company. Hence, we can say that a private company is a harmonious compromise between public limited company and partnership.

Regards,