Assertion (A): A company is a legal entity separate and distinct from its members. Reason (R): A company can enter into a contract. It can sue and be sued in its own name. In the context of the above two statements, which of the following is correct?

Question

KollegeApply · Accepted Answer

Both (A) and (R) are true and (R) is the correct explanation of (A). Explanation: Assertion (A) is true: A company is a separate legal entity from its members. Reason (R) is also true: Because of this separate identity, it can enter contracts and sue or be sued in its own name. So, (R) correctly explains (A).

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