Share:
A share is a share in the share capital of the company , it is define as a small part of the capital which is contributed by share holders.
There are two types of share:
1. Equity share
2. Preference share
1. Equity share:-
These are the shares which do not enjoy the preference right in respect of receiving the dividend or re-payment of capital during winding up of company.
2. Preference share:-
These are the shares who get the priority all preference giving respect of payment of preference during existing of company and re-payment of capital during liquidation.
Debentures:-
It is a Latin word deber which means achnolegement (debt).
According to sec 2(12) of companies act
" Debentures includes the bonds , stock and other security of the company which constitutes the charge on the assets of the company or not "
There are several types of debentures.
Difference between shares and debentures.
Shares :
1. Owners of the company
2. paid up return is called as dividend
3. Share holders having voting rights
4. They do not create any charges on asset
5. It cannot bi converted into debentures
Debentures :
1. Loans and borrowings of the company
2. The amount return is called as interest
3. They don't have voting rights
4. They create charges on asset
5. It can bi converted into shares
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