Definition of a Private Limited Company
Section 2(68) of the Companies Act, 2013 (‘Act’) defines a private company as a company having a minimum paid-up capital as prescribed and whose articles of association:
Restricts the right to transfer shares
Excluding One Person Company (OPC) limits the number of its members to 200
Restricts any invitation to the public to subscribe to any company securities
However, when two or more members of a private limited company hold one or more shares jointly, they are considered a single member. Further, the following will not be considered as company members:
Persons who are employees of the company
Persons who were former employees of the company and also members while in employment and continued to be members after cessation of their employment
