Define private company.

A private company means a company which has a minimum paid-up capital of one lakh rupees or such higher capital as may be prescribed and which by its Articles of Association :

1. restricts the right of its members to transfer shares, if any;
2. limits the number of its members to 200, excluding members who are or were in the employment of the company;
3. prohibits any invitation to the public to subscribe for any shares in, or debentures of the company; and
4. prohibits any invitation or acceptance of deposits from persons other than its members, directors or their relatives.

The minimum number of members required to form a private company is two. Such a company must use the word 'private' in its name. L.G. Electronics Pvt. Ltd., Competent Automobiles (P) Ltd., and Allied Motors Pvt. Ltd. are examples of private limited companies in India.