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Alteration in Name Clause of MOA

Introduction

Memorandum of Association (MOA) is the charter document of the company containing basic information about the company. MOA contains under it six clauses that can be altered to some extent and that too requires a legal process to adopt the alteration.

In order to learn the process of alternation of name clauses in the memorandum of association, you must be aware of the term MOA. So, let’s start by defining MOA in short and simple language.

Memorandum of Association being the charter of the company contains the scope of the activities. It contains the company’s important clauses, namely:-

  1. Name Clause which contains the name of the company
  2. Registered office Clause which contains the State of India where the registered office of the company is situated.
  3. Objects Clause of the company and matters considered necessary in furtherance thereof
  4. Liability Clause which defines the liability of members of the company, and
  5. Share Capital Clause which defines the Authorized share capital of the company
  6. Subscription clause which prescribes the number of shares to which the subscribers to the memorandum agree to subscribe which shall not be less than one share.

Alteration of MOA in Name Clause

If a company wants to alter its name then in that case, a special resolution, as well as an approval of the Central Government in writing, must be required.

Where there arises a change in the name of the company relating to the addition/deletion of the word ‘Private’ to the name of the company consequent to the conversion of a company into a public company and vice versa. So, in this case, the Registrar shall enter the new name in the register of companies in place of the old name and issue a fresh certificate of incorporation with the new name and such change in the name shall be complete and effective only on the issue of such a certificate.

As per Section 29 of Companies (Incorporation) Rules 2014, the change of name shall not be allowed to a company that has not filed annual returns or financial statements due for filing with the Registrar or which has failed to pay or repay matured deposits or debentures or interest thereon. However, the change of name shall be allowed upon filing necessary documents or payment or repayment of matured deposits or debentures or interest thereon as the case may be.

Methods of changing the name

Here are some of the methods which can be utilized after the incorporation of the company. Hence, with any of the following methods, you can convert your company’s name.

  1. Conversion of private limited company into public limited company and thereby change in the name from private to public; or
  2. Conversion of public limited company into private limited company and thereby change in the name from public to private; or
  3. Change of name from ABC limited to XYZ limited.

Procedure for Alteration in Name Clause of Memorandum

Step 1: Calling of Board Meeting
Notice of Board Meeting is necessary to be sent at least 7 days prior to the date of Board Meeting. Along with it, pass a board resolution authorizing the Company Secretary/Director to make the required application to the Registrar of Companies in Form INC-1.

Step 2: Apply for two names in the RUN web service on MCA website
As per Section 4(4) of the Act read with Rule 9 of Companies (Incorporation) Rules 2014 application for the reservation/availability of the name shall be in RUN along with the prescribed fee of Rs. 1,000/-.

Step 3: Obtaining ROC Approval and Name Availability Letter
The approval letter will be issued by Registrar, CRC after analyzing the application and the name allocated will be valid for a period of 60 days from the date of application.

On receipt of approval of name, the Company Secretary/ Director shall convene another Board Meeting:-

  1. To take note of the name approval received from ROC
  2. To fix date, time and place for holding EGM to get approval of shareholders by way of Special Resolution for amendment in Name clause of Memorandum.
  3. To approve notice of EGM along with Agenda and explanatory statement to be annexed to the notice of General Meeting
  4. To authorize the Director or Company Secretary to issue a Notice of the EGM as approved by the board.

Step 4: Conduct General Meeting and pass Special Resolution
In the general meeting, special resolution will be passed by shareholders for alteration of Memorandum with concerned ROC and file Form MGT-14 (certified by a Practicing Professional i.e. CS/CA/CWA) within 30 days of passing the resolution with prescribed fees and along with the following attachments, namely:-

  • Certified True copy of Special Resolution along with explanatory statement pursuant to section 102
  • Altered Memorandum of Association
  • Certified True copy of Special Resolution along with explanatory statement pursuant to section 102 for the Alteration of Articles pursuant to alteration in the name clause of the Memorandum of Association of the company
  • Altered Articles of Association

Step 5: File INC-24 with Registrar

The application for the fresh certificate of incorporation in the new name of the company be made in form INC-24 to the Registrar within the 30 days along with the prescribed fees and here are some necessary attachment, namely:-

  • Minutes of the member’s meeting
  • Copy of the certificate of incorporation along with the copy of the Altered MOA and AOA of the company may be attached to the form INC 24 as an optional attachment.

Step 6: Approval from the Registrar of Companies

When the registrar scrutinizes the documents and is satisfied then, ROC shall issue a fresh certificate of incorporation digitally signed in Form INC-25.

This is the 6-step guide relating to the process of alteration of charter documents of the company. The alteration in the name clause is completed, but there are some other necessary provisions to be adhered to. The provision states:-

  1. When approval is granted, intimate all concerned persons/authorities about the changed name of the company.
  2. Get a new common seal of the company in the new name. However, it is not a mandatory step
  3. Correct all records by entering the new name of the company including Register of Members, every copy of the Memorandum and Articles of Association, other books and documents pertaining to the company’s business and affairs to display the new name.
  4. The company shall paint, affix or print as the may be the former name or names so changed during the period of last two years.

Effect of change in name clause of MOA

The change of name shall not affect any rights or obligations of the company or render defective any legal proceedings by or against it, and any legal proceedings which might have been continued or commenced by or against the company in its former name may be continued by or against the company in the new name.

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