Various Types of Enterprises In India
There are several kinds of enterprises in India as follows:
Proprietary
When an individual is the sole owner of an enterprise it is a proprietary enterprise. Own account production of fixed assets for own use, when produced by a single member, will be classified as proprietary enterprise.
Partnership
Partnership is defined as the ‘relation between persons who have agreed to share the profits of a business carried on by all or any one of them acting for all’. There may be two or more owners, belonging to the same or different households, on a partnership basis, with or without formal registration (where there is a tacit understanding about the distribution of profit among the so-called partners). Own account production of fixed assets, when produced by two or more members belonging to the same or different households was classified as partnership enterprises. Thus, own account production of fixed assets by a group of households for community use was classified as partnership enterprise.
Government/Local Body
Government/local body includes Government administrative departments of both the Central and State Governments, local bodies of rural and urban areas and Departmental Enterprises like Indian Railways, Department of Post, etc.
Public Sector Enterprises
Public Sector Enterprises included government companies and subsidiaries of government companies and statutory corporations set up under special enactments of Parliament or State Legislatures. Some of these are Damodar Valley Corporation, Food Corporation of India, Airports Authority of India, Road Transport Corporations, Warehousing Corporations, Electricity Boards, etc.
Some of the financial enterprises included the nationalised banks, Central and State financial corporations, LIC, GIC, Employees State Insurance Corporation (ESIC), etc. The non-financial public sector enterprises consisted of all the undertakings/ enterprises of central, state, union territory governments and local authorities under the industry groups agriculture, forestry and logging, fishing, mining, manufacturing, electricity and gas, road, air and water transport including port trusts, storage and warehousing, trade, hotels & restaurants and other services.
Autonomous Bodies
Autonomous Bodies are mostly set up by an Act of Parliament/Assembly or registered under Societies Registration Act. However, they are separate from Government Administrative Departments as they enjoy certain degree of autonomy in their day to day functioning. They receive grants from Government in addition to their own resources. Further, these are engaged in non-market production. Some of the autonomous bodies are: All India Institute of Medical Sciences, Indian Institute of Technology, Indian Statistical Institute, Housing Boards, Development Boards, Pollution Control Boards etc.
Public Limited Company
A public limited company is defined as a company that is not a private company. As such public companies can have an unlimited number of members and can invite the public to subscribe to its shares and debentures. The minimum number of members required to form a public limited company is seven.
Private Limited Company
Private limited company means a company which by its articles:
(a) restricts the right to transfer its shares, if any
(b) limits the number of its members to two hundred not including-
- persons who are in the employment of the company, and
- persons who, having been formerly in the employment of the company, were members of the company while in that employment and have continued to be members after the employment ceased; and
- prohibits any invitation to the public to subscribe for any share in, or debentures of, the company. [Where two or more persons hold jointly one or more shares in a company, they shall, for the purpose of this definition, be treated as a single member.]
Co-operative Societies
Co-operative society is one that is formed through the co-operation of a number of persons, recognized as members of the society, to benefit themselves. In the process, the funds are raised by members’ contributions/investments and the profits generated out of the society’s activities are shared by the members. The government itself in a government agency can also be a member or shareholder of a registered co-operative society but this fact cannot render the society into a public sector enterprise for the purpose of this survey.
Trust
An arrangement through which one set of people, the trustees, are the legal owners of property which is administered in the interest of another set, the beneficiaries. Trusts may be set up to provide support for individuals or families, to provide pensions, to run charities, to liquidate the property of the bankrupts for the benefit of their creditors, or for the safe keeping of securities bought by trusts with their investor’s money. The assets, which trusts hold are regulated by law, must be administered in the interests of the beneficiaries, and not for the profit of the trustees.
Non-Profit Institutions (NPI)
NPIs are legal or social entities created for the purpose of producing goods and services whose status does not permit them to be a source of income, profit or other financial gain for the units that establish, control or finance them. In practice, their productive activities are bound to generate either surpluses or deficits but any surpluses they happen to make cannot be appropriated by other institutional units. The articles of association by which they are established are drawn up in such a way that the institutional units which control or manage them are not entitled to a share in any profits or other income which they receive.
