Question
State the difference between Co-operative Society and Company.
| No. | Points of Difference | Co-operation society | Company |
| $1.$ | Meaning | It is a group of people gathered voluntarily for one’s own economic upliftment on the basis of equality. | It is a voluntary group of people gathered to earn profit through business. |
| $2.$ | Objective | Objective of profit is subsidiary. The main objective is service to people and their economic upliftment | Main objective is to earn profit and give financial benefit to members. |
| $3.$ | Procedure of Establish | Procedure of establishment is simple compare to that of a company. | Procedure of establishment is lengthy and expensive. |
| $4.$ | Applicable Law | Co-operative Society Act is applicable to Co-operative Society. | Companies Act is applicable to the company. |
| $5.$ | Number of Member | Minimum 10 members. No provision for maximum number. | In public company minimum 7 and no provision for maximum number. |
| $6.$ | Type of Shares | Co-operative Society can issue the share of only one type and of the same right. | Besides equity shares company can issue various types of preference shares |
| $7.$ | Transfer of Shares | Members of Co-Op. Society cannot transfer their Shares. | Members can transfer their Shares. |
| $8.$ | Effect in Share Capital | Capital fund reduces when the member submits share certificate and his capital is refunded. | Members can not get back their capital by submitting their shares. There is no reduction in share capital. |
| $9.$ | Use of Profit | As per the provision of Co.-Op. Society, profit is distributed among members as dividend and the remaining profit is used for the welfare of members. | Profit of the company is distributed among members as dividend and as bonus share. |
| $10.$ | Registration of Shares | Shares of Co-Op. Society are not listed on stock exchange. | Shares of the company are listed on recognized stock exchange. |
| $11.$ | Management | It is democratically managed because voting right is per head. | Voting right is considered per share so management is not carried on democratically. |
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