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Classification of Companies:
Section 389 of the Companies Act provides that "no company there association or may partnership consisting of more than twenty persons shall be formed... unless it is registered as a company under this Act so there it t is formed in pursuance of some other Act, Act of the United Kingdom or of letters patent".
Three types of company are provided for under this section as like are:
(a) Chartered companies.
(b) Statutory companies.
(c) Registered companies.
Explanatory statement - mergers and winding up: It is also necessary that the members or creditors who are to vote on the scheme should be able to understand its full effects.
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