The Companies Act 2013 had introduced the concept of Small Company. It is not specifically registered with the specific name but is simply a Private Company with less amount of investment and less turnover. In a Developing Country like India, such a company plays a significant role.
According to Companies Act 2013, Small company means the company which satisfies the following conditions:-
A Company is not a Small Company if:-
Companies Act 2013 provides certain benefits to the Small companies which includes:-
A small company is a private company whose capital does not exceed 50 lakhs or such higher amount as prescribed which shall not be more than 10 crores and turnover does not exceed 2 crores or such higher amount as may be prescribed which shall not be more than 100 crores while a Private company includes a Small Company.
If the capital of a Small Company or turnover exceeds the threshold limit, it is no more considered as a Small Company and it can no more enjoy the privileges granted to a Small Company under the Act.