TP Private Ltd. Company registered under the Companies Act, 2013 with paid up capital of ₹ 35 lakh and turnover of ₹ 2.5 crore. Explain the meaning of 'Small Company' and examine the following in accordance with the prov

Section 2(85) of the Companies Act, 2013 defines a 'small company' as a company, other than a public company, (i) paid-up share capital of which does not exceed fifty lakh rupees or such higher amount as may be prescribed which shall not be more than ten crore rupees; and (ii) turnover of which as per profit and loss account for the immediately preceding financial year does not exceed two crore rupees or such higher amount as may be prescribed which shall not be more than one hundred crore rupees: Provided that nothing in this clause shall apply to - (A) a holding company or a subsidiary company; (B) a company registered under section 8; or (C) a company or body corporate governed by any Special Act. Hence, in order to avail the status of a 'small company', a company has to fulfill both conditions (i) and (ii) above. (i) In the given case, TP Pvt. Ltd. is a registered company under the Companies Act, 2013 with a paid-up capital of ₹ 35 lakh and turnover of ₹ 2.5 crore. As per the provision it only meets one criteria i.e. share capital does not exceed fifty lakh rupees and does not meet the second criteria. Hence, TP Pvt. Ltd. cannot avail the status of small company. (ii) If the turnover of the company is ₹ 1 crore then TP Pvt. Ltd. can avail the status of small company as both the conditions will be fulfilled.