Question

Short Answer Type Questions: Explain the features of a government company.

Answer 1

Following are the features of a Government company:

1. Has a separate legal entity
2. Registered under the Companies Act
3. The board of directors represent the government
4. Government provides for whole or part of the capital required
5. The company is audited by the Comptroller and Auditor General of India
6. It is partly or wholly owned by the government. Atleast 51% of the paid up share capital belongs to the government.
7. It can enter into a contract and acquire property in its name
8. The management is regulated by the company guidelines hence it has its own staffing system.
9. It has borrowing powers from public
10. It has the power to use the revenue that is generated from the business
11. Employees are not civil servants
12. Company is accountable to the government and the shareholders
13. It can sue and be sued by others.