BANKING TRADE AND COMMERCE

JOINT STOCK COMPANIES

Joint-stock companies: Joint-stock companies in Ahmadnagar district appear to have developed out of partnership or proprietary type of concerns. The companies required a large amount of capital which was not easy for a single individual to supply. Credit, too, was not obtainable unless complete security could be provided to the. creditor. The partnership concerns were even the worst form than the individual or the proprietary concerns because they depended on a smooth co-ordination amongst their members. The joint-stock companies as they exist today, therefore, came up as a more suitable form of business organisation through which instability in business could be reduced to a great extent.

In Ahmadnagar district, there are two types of companies — private limited companies and public limited companies. [The Indian Companies Act of 1956 described the former as one which restricts the right to transfer its shares, if any, limits the number of its members to fifty and prohibits any invitation to the public to subscribe for any shares and/or debentures of the company. The Act further lays down that no company, association or partnership consisting of more than twenty persons shall be formed for the purpose of carrying on any other business that has for its object an acquisition of gain by the company, association or partnership, or by the individual members thereof, unless it is registered as a company. Registration, thus, was made compulsory for these companies.]

The Aphali Pharmaceuticals was the first company to be established in the district. Established in October 1933 it had a total of 17 shareholders. At present (1970) there are in all 14 private companies in Ahmadnagar district. The growth of the private limited companies in the district took place after the forties. A classification of these companies according to the nature of their operations shows that of the 14 joint-stock companies, six are working in the field of general trading and eight are manufacturing companies.

Public limited companies engage themselves in various kinds of productive activities with a view to obtaining profits. As a rule, they require large capital due to the extent of their operations. They use it for acquisition and maintenance of plant, equipment, buildings and other fixed assets, for holding current assets in the form of inventories of finished or partly-finished products as well as raw materials and stores required for production. Capital is also required to be used as current assets and accounts receivable. Capital is raised by floating shares and by issuing debentures. The shares are transferable and negotiable by law.

The number of public limited companies in Ahmadnagar district other than the joint-stock banks is small. At present (1970) there are only four public limited companies. The first public limited company, namely, Ahmadnagar Imarat Company, was established on 2nd January 1891 with an authorised capital of Rs. 80,000. The number of its shareholders is 53 and its subscribed as also the paid-up capital is Rs. 80,000.

Table No. 17 gives the information about public and private companies registered up to 1966 in the district.

TABLE No. 17—STATISTICS RELATING TO PUBLIC AND PRIVATE COMPANIES IN AHMADNAGAR DISTRICT

N.A. =Not available.

TOP