3. Widely held company:
It is a company in which the public are substantially interested.
4. Closely held company:
It is a company in which the public are not substantially interested.
5. Indian company [Section 2(26)]:
'Indian Company' means a company formed and registered under the Companies Act, 1956 and includes—
a company formed and registered under any law relating to companies formerly in force in any part of India (other than the State of Jammu and Kashmir and the Union Territories;
a corporation established by or under a Central, State or Provincial Act;
any institution, association or body which is declared by the Board to be a company;
in the case of the state of Jammu and Kashmir, a company formed and registered under any law for the time being in force in that State;
in the case of any of the Union territories of Dadra and Nagar Haveli, Goa, Daman and Diu, and Pondicherry, a company formed and registered under any law for the time being in force in that Union Territory.
Provided that the registered or, as the case may be, principal office of the company, corporation, institution, association or body, in all cases is in India.
6. Domestic company [Section 2(22A)]:
A domestic company means an Indian company or any other company which in respect of its income, liable to tax under the Income-tax Act, has made the prescribed arrangements for the declaration and payment within India, of the dividends (including dividends on preference shares) payable out of such income.
Thus, all Indian Company are treated as Domestic Company but all Domestic Company are not Indian Company.
If a Foreign Company makes prescribed arrangements for payment of dividends in India it shall be treated as Domestic Company.
7. Foreign company [Section 2(23A)]:
Foreign company means a company which is not a domestic company, i.e. a company registered outside India in any other foreign country.
The Foreign Company may be treated as Domestic Company if such company makes prescribed arrangement in India as per Rule 27.
Rule 27. : Prescribed arrangement for declaration and payment of dividends within India.
The arrangements referred to in sections 194 and 236 to be made by a company for the declaration and payment of dividends ( including dividends on preference shares) within India shall be as follows :
The share-register of the company for all shareholders shall be regularly maintained at its principal place of business within India, in respect of any assessment year from a date not later than the 1st day of April of such year.
The general meeting for passing the accounts of the previous years relevant to the assessment year and for declaring any dividends in respect thereof shall be held only at a place within India.
The Dividend declared , if any, shall be payable only within India to all shareholder
Sec.6(3), Residential Status of foreign Company
Foreign Company is treated as Resident in India if its Control and Management is located wholly in India.
Foreign Company is treated as Non-Resident in India if its Control and Management located wholly / partially Outside India.
Sections applicable to Foreign Company are 44BBB, 44D, 115A, 195 etc.
8. Investment Company:
Investment company means a company whose gross total income consists mainly of income which is chargeable under the heads Income from house property, Capital gains and Income from other sources.
9. Residence of a Company [Section 6(3)]
When is a company said to be Resident in India?
A company is said to be Resident in India in any previous year, if—
- it is an Indian company; or
- its place of effective management, in that year, is in India.
When is a company said to be Non-Resident in India ?
Provisions applicable from assessment year 2017-18
A Company will be a Non-Resident in any previous year if:
- it is not an Indian company and
- its place of effective management, in that year, is not in India.