Every Company is comprised of members though in the contemplation of law a Company is an entity distinct from its constituent members. In all important matters a Company can act only through its members. Only members of a Company are entitles to receive a notice of annual and other general meetings, to exercise voting rights at such meetings and to inspect the Register of Members and others statutory registers maintained by a Company and so on. A Company is created by the members and runs for the members and after the objectives for which it is promoted is achieved, is also wound-up by the members.
Every subscriber of the memorandum of company shall be deemed to have agreed to become a member of the company and on its registration shall be entered as a member in its register of members. Every other person who agrees to become a member of a company, and whose name is entered in its register of members shall be a member of the company. (Sec-32)
The holder of shares in a registered company is known as shareholder and when his/her name in entered in the registered of members he/she is the Member of the Company. Thus ‘Member’ and ‘Shareholders’ are synonymous terms.
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