MEMBERSHIP IN A COMPANYDISTINCTION BETWEEN A SHAREHOLDER & A MEMBER: 1) A registered shareholder is a member but a member may not be a shareholder, because Co. may not have share capital 2) member has sold his shares but continues to be a member since purchaser is yet to register them in his name, 3) legal rep. of a deceased member is not a member but he is a shareholder 4) if owns a bearer share warrant he is a shareholder but not a member.WHO CAN BE A MEMBER: Any person who is competent to contract. A minor can be shareholder if AOA provides, guardian signs and share are fully paid. Partners can apply in their joint name. A Co. can become member in another Co. but cannot buy and register its own shares. A subsidiary Co. cannot be a member of its holding Co. Section 25 Companies can have firms as its member. An insolvent may be a member till his name appears in the register, and can also vote.

MEMBERSHIP & CESSATIONMEMBERSHIP BY SUBSCRIPTION: Subscribers to MOA has agreed to become member. Neither application nor allotment of share is necessary. He is bound to pay and take those shares.MEMBERSHIP BY APPLICATION: Written application and allotment of shares for persons who agrees to become member.

BY TRANSFER, BY SUCCESSION.

BY BENEFICIAL OWNERSHIP: Holders of shares in depository account as beneficial owners are deemed to be members.BY QUALIFICATION SHARES: Before being appointed as director he must take or sign an undertaking to take and pay for the shares.

CESSATION OF MEMBERSHIP: BY ACT OF PARTIES: Transfer, forfeiture, sale, rescinds the contract, when preference share are redeemed, surrender and when share warrants are issued.CESSATION BY OPERATION OF LAW: By insolvency, death, winding up of the Company.

REGISTER OF MEMBERSNormally kept at the Reg.office. Penalty if default is made. Contains : Name & address, shares with distinctive nos., amt paid, date of entry in the register, date he ceased etc. An entry in the register determines his rights and liabilities. Also Co. to maintain foreign registers & update Register of Mem. and inform ROC.

INDEX OF MEMBERS : If more than 50 members, index of members also to be kept. To be updated within 14 days.REGISTER AND INDEX OF BENEFICIAL OWNERS: When shares are in DEMAT form, the index can be maintained by Depository.

INSPECTION: It is a public document open for inspection, 2 hours each day & no charges for members and they can also take details. On payment, Co. to give extracts from register within 10 days.CLOSURE OF REGISTER: Can be closed for 45 days per year, not more than 30 days one time. Closed for the purpose of dividend etc.. as per Stock exchange requirements, normally before AGM. Can have RECORD DATE for declaration of Bonus shares etc..

RECTIFICATION: Any mistake, error, defect can be corrected and it will date back to the date on which it was made.

RIGHTS & LIABILITIES OF MEMBERSSTATUTORY RIGHTS: Given by Companies Act and therefore these rights CANNOT be taken away or modified by MOA or AOA. Some of them are: Right to have a copy of MOA & AOA, For rights shares, to transfer shares, to vote, to inspect register of members, to receive notice of statutory meeting, to appoint proxy, to demand poll, to received dividend if declared, to received copy of annual accounts.. DOCUMENTARY RIGHTS: Given in MOA & AOA.LEGAL RIGHTS: Given to members under the general law.RIGHTS TO SHARE ASSETS OF THE COMPANY: If the Co. is wound up - for the surplus assets, if any.LIABILITIES OF MEMBERS: 1) COMPANY WITH UNLIMITED LIABILITY : Liability of members will be unlimited. 2) COMPANY WITH LIMITED LIABILITY - LIMITED BY SHARES: Limited to nominal value / unpaid amount. 3) LIMITED BY GURANTEE : Amount that is guaranteed.If the number of members fall below 2 OR 7 and it continues its business for more than 6 months with the knowledge of them, such members become severally liable for the Companies debts.