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Microlesson · 5-min read

Company, Company Incorporated Outside India, and Body Corporate – Definitions and Distinctions

# Company, Company Incorporated Outside India, and Body Corporate

The Companies Act, 2013 uses three terms that are closely related but legally distinct. Understanding the difference is foundational because the applicability of provisions varies depending on which category an entity falls into.

## 1. Company

A Company means a company incorporated under:

  • The Companies Act, 2013, or
  • Any previous company law (e.g., the Companies Act, 1956).

Key point: Incorporation must be in India.

## 2. Company Incorporated Outside India

A company incorporated under any Act outside India (i.e., under the law of a foreign country).

Key point: It is not a 'Company' under the Companies Act, 2013, but is still treated as a separate category for certain provisions (covered later in Chapter 11 — Companies Incorporated Outside India).

## 3. Body Corporate

Definition: A corporate entity which has a separate legal existence.

### Inclusions (what IS a Body Corporate)

  • Company incorporated in India
  • Company incorporated outside India
  • Limited Liability Partnership (LLP)

### Exclusions (what is NOT a Body Corporate)

  • Co-operative society
  • Sole Proprietorship
  • Partnership Firm

## Quick Comparison Table

EntityCompany?Co. Incorporated Outside India?Body Corporate?
Indian Co. (Cos. Act, 2013/1956)YesNoYes
Foreign Co. (incorporated abroad)NoYesYes
LLPNoNoYes
Partnership Firm / Sole Prop.NoNoNo
Co-operative SocietyNoNoNo

## Why this matters

Many sections of the Companies Act apply to a 'company' only, while others extend to a 'body corporate.' Misclassifying an entity leads to wrong conclusions about whether a section applies.

Worked example

### Example 1

Example 1 – Indian Company: Reliance Industries Ltd. was incorporated in 1973 under the Companies Act, 1956. Since it is incorporated in India under a previous company law, it qualifies as a Company under the Companies Act, 2013 and is also a Body Corporate.

### Example 2

Example 2 – Foreign Parent with Indian Subsidiary: Apple Inc. is incorporated under the USA Companies Act and operates in India through its subsidiary Apple India Pvt. Ltd.

  • Apple Inc.: NOT a Company under the Companies Act, 2013. It IS a Company Incorporated Outside India and a Body Corporate.
  • Apple India Pvt. Ltd.: IS a Company under the Companies Act, 2013 and also a Body Corporate (being incorporated in India).

⚠️ Common exam mistakes

  • Treating a foreign-incorporated company as a 'Company' under the Companies Act, 2013 — it is only a 'Company Incorporated Outside India'.
  • Forgetting that an LLP is a Body Corporate even though it is not a Company.
  • Including partnership firms or sole proprietorships in 'Body Corporate' — they have no separate legal existence and are excluded.
  • Assuming co-operative societies are Bodies Corporate — they are specifically excluded under the Act.
Reference:
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