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Microlesson · 5-min read

Definition of Company and Applicability of the Act

# Definition of 'Company' and Scope of the Act

## Definition - Section 2(20)

> A 'company' means a company incorporated under the Companies Act, 2013 or under any of the previous laws relating to companies.

This is a circular but meaningful definition - what makes a company a company is the act of incorporation under company law.

## To Whom Does the Act Apply?

The Act applies to:

#Type of EntitySpecial Rule
1Companies incorporated under this Act or any previous company lawFully applicable
2Insurance companiesApplies except where inconsistent with Insurance Act, 1938 / IRDA Act, 1999
3Banking companiesApplies except where inconsistent with Banking Regulation Act, 1949
4Companies in generation/supply of electricityApplies except where inconsistent with Electricity Act, 2003
5Any company governed by a special ActApplies except where inconsistent with that special Act
6Body corporate incorporated by any Act, as Central Government may notifyApplies as notified

## Examples of Category 6

  • Food Corporation of India (FCI)
  • National Highway Authority of India (NHAI)

## Key Pattern to Remember

For regulated sectors (insurance, banking, electricity), the special law prevails to the extent of inconsistency. The Companies Act fills the gaps.

Worked example

### Example 1

Q: State Bank of India (a banking company) - does the Companies Act, 2013 apply to it?

A: Yes, the Companies Act, 2013 applies, BUT only to the extent its provisions are NOT inconsistent with the Banking Regulation Act, 1949. Where the Banking Regulation Act provides specific rules (e.g., on capital, licensing), those prevail.

⚠️ Common exam mistakes

  • Stating that the Companies Act does NOT apply to banks/insurance companies at all - it does apply, just subordinated to the special Act where inconsistent.
  • Forgetting that NHAI and FCI fall under Category 6 (body corporate by special Act, notified by Central Government).
Bare-Act text Section 2(20) · Companies Act, 2013 · click to expand
'company' means a company incorporated under this Act or under any previous company law.
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