# Formation of Company — Section 3
## The opening rule
A company may be formed for any lawful purpose by:
| Type of Company | Minimum number of persons subscribing to MoA |
|---|---|
| Public Company | 7 or more persons |
| Private Company | 2 or more persons |
| One Person Company (OPC) | 1 person |
The formation must be by subscribing to a Memorandum and complying with the requirements of the Act.
## Permissible categories of liability
Such a company may be formed as:
1. A company limited by shares;
2. A company limited by guarantee;
3. An unlimited company.
## Three pillars to remember
```
FORMATION OF COMPANY (Section 3)
PURPOSE PERSONS LIABILITY
Lawful 7 / 2 / 1 Shares / Guarantee / Unlimited
```
## Subscribing to the MoA
Each person counted must:
- sign the Memorandum of Association;
- agree to take at least one share (for a company limited by shares);
- provide their consent and PAN/identification as per Rules.
## Companion provision — Section 3A
If the membership falls below the minimum (2 for private, 7 for public) and the company carries on business for more than 6 months while the membership remains below the limit, every member aware of this fact becomes severally liable for the company's debts contracted during this period — and may be sued individually.
## Practical incorporation forms (TOC reference)
- SPICe+ (INC-32) — integrated incorporation application (name reservation, registration, OPC nominee, AoA entrenchment).
- INC-33 / INC-34 — eMoA and eAoA.
- DIR-2, DIR-12 — first director consent and filing.
- INC-8, INC-9 — declarations by professional and subscribers/first directors.
- INC-11 — Certificate of Incorporation issued by RoC.
- INC-20A — declaration of commencement of business (Sec 10A).
## Quick takeaways
- The purpose of formation matters — only lawful purposes (Sec 6 also reinforces this; criminal objects vitiate registration).
- The Act recognises 3 minimum-member buckets mapped to 3 company types.
- The Act recognises 3 liability structures.