law: Companies Act, 1956
  Sec 12    -     Mode of
  
  forming incorporated company. 
  (1) Any seven or more persons, or where the
  
  company to be formed will be a private company, any two or more persons,
  
  associated for any lawful purpose may, by subscribing their names to a
  
  memorandum of association and otherwise complying with the requirements of this
  
  Act in respect of registration, form an incorporated company, with or without
  
  limited liability.
  (2) Such a company may be either :
  (a) a company having the liability of its
  
  members limited by the memorandum to the amount, if any, unpaid on the shares
  
  respectively held by them (in this Act termed "a company limited by
  
  shares");
  (b) a company having the liability of its
  
  members limited by the memorandum to such amount as the members may
  
  respectively undertake by the memorandum to contribute to the assets of the
  
  company in the event of its being wound up (in this Act termed "a company
  
  limited by guarantee"); or
  (c) a company not having any limit on the
  
  liability of its members (in this Act termed "an unlimited company").