## Government Company [Section 2(45)]

### Definition

'Government Company' means any company in which not less than 51% of the paid-up share capital is held by:

The Central Government, or
Any State Government or Governments, or
Partly by the Central Government and partly by one or more State Governments.

Inclusion: A company which is a subsidiary of a Government Company is also a Government Company.

### Key Test

The shareholding criterion (≥ 51%) is the sole determinative test. Form of business activity, listing status, or sector is irrelevant.

### Examples (Conceptual)

A central PSU where the Central Government holds 60% — Government Company.
A company where the Central Government holds 30% and a State Government holds 25% (total 55%) — Government Company.
A wholly-owned subsidiary of a PSU — Government Company.

⚠️ Common exam mistakes

Ignoring the inclusion of subsidiaries of Government Companies.
Adding only Central Government holding while ignoring State Government holdings.
Confusing 'Government Company' with 'PSU' or 'Public Company' — they are not synonymous.

Bare-Act text Section 2(45) · Companies Act, 2013 · click to expand

'Government company' means any company in which not less than fifty-one per cent. of the paid-up share capital is held by the Central Government, or by any State Government or Governments, or partly by the Central Government and partly by one or more State Governments, and includes a company which is a subsidiary company of such a Government company.

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Government Company [Section 2(45)]

Worked example

⚠️ Common exam mistakes