Unit 3 – Companies Act

1. Define company
“A company formed and registered under Companies Act 1956 or an existing company
which was formed and registered under any of the previous company laws.
2. State any two objectives of Companies Act
 A minimum standard of good behaviour and business honesty in company
promotion and management.
 Provision for greater and effective control over the management for shareholders.
 A fair and true disclosure of the affairs of companies in their annual published
balance sheet and profit and loss accounts.
 Proper standard of accounting and auditing.
 Recognition of the rights of shareholders to receive reasonable information and
facilities for exercising an intelligent judgment with reference to the management.
 A ceiling on the share of profits payable to managements as remuneration for
services rendered.
 A check on their transactions where there was a possibility of conflict of duty and
interest.
 A provision for investigation into the affairs of any company managed in a manner
oppressive to minority of the shareholders or prejudicial to the interest of the
company as a whole.
 Enforcement of the performance of their duties by those engaged in the
management of public companies or of private companies which are subsidiaries of
public companies by providing sanctions in the case of breach and subjecting the
latter also to the more restrictive provisions of law applicable to public companies.
3. Who is a promoter?
A person who devises a plan for a business venture; one who takes the preliminary steps
necessary for the formation of a corporation. Promoters are the people, who, for
themselves or on behalf of others, organize a corporation. They issue a prospectus,
obtain stock subscriptions, and secure a charter.
4. Identify the fiduciary duties of a promoter
Promoter may not make any profit at the expense of the company
Promoter has to give benefit of negotiations to the company
Promoter has to make a full disclosure of interest or profit
Promoter has not to make unfair use of position.
5. What do you mean by preliminary contracts?
Preliminary contracts are contracts entered into by the promoters on behalf of the company
before its incorporation with third parties as agents or trustees of the company, which has
not yet come into existence. Such contracts are legally not binding upon the company even
after it comes into existence. The company can neither ratify those contracts nor sue the
vendors on them after its incorporation because ratification requires existence of the
principal at the time when the contract was entered into.
6. What is memorandum of association?
A Memorandum of Association is a legal document prepared in the formation and
registration process of a limited liability company to define its relationship with
shareholders. The Memorandum of Association is accessible to the public and describes
the company’s name, physical address of registered office, names of shareholders and
the distribution of shares.
7. Define articles of association.
Articles of association are a document that specifies the regulations for a company's
operations and defines the company's purpose. The document lays out how tasks are to be
accomplished within the organization, including the process for appointing directors and the
handling of financial records.

8. What is prospectus?
A prospectus is a formal document that is required by and filed with the Securities and
Exchange Commission (SEC) that provides details about an investment offering for sale
to the public. A prospectus is filed for stock, bond, and mutual fund offerings. A
prospectus is used to help investors make a more informed investment decision.
9. State any four advantages of limited liability partnership
No requirement of minimum contribution
No limit on owners of business
Lower registration cost
No requirement of compulsory Audit

10. State the procedure for registration for change in partners/names.

where a person becomes or ceases to be a partner, file a notice with the Registrar within
thirty days from the date he becomes or ceases to be a partner
where there is any change in the name or address of a partner, file a notice with the
Registrar within thirty days of such change.
Part B
Q. 1 Explain the essential characteristics of a company under company law
Separate Legal Entity
Limited Liability
Perpetual Succession
Separate Property
Transferability of Shares
Common Seal
Capacity to sue and being sued
Separate Management
One Share-One Vote
A company as an entity has many distinct features which together make it a unique
organization. The essential characteristics of a company are following:

Separate Legal Entity:

Under Incorporation law, a company becomes a separate legal entity as compared to its
members. The company is distinct and different from its members in law. It has its own
seal and its own name, its assets and liabilities are separate and distinct from those of its
members. It is capable of owning property, incurring debt, and borrowing money,
employing people, having a bank account, entering into contracts and suing and being
sued separately.

Limited Liability:
The liability of the members of the company is limited to contribution to the assets of
the company upto the face value of shares held by him. A member is liable to pay only
the uncalled money due on shares held by him. If the assets of the firm are not sufficient
to pay the liabilities of the firm, the creditors can force the partners to make good the
deficit from their personal assets. This cannot be done in the case of a company once
the members have paid all their dues towards the shares held by them in the company.

Perpetual Succession:
A company does not cease to exist unless it is specifically wound up or the task for which
it was formed has been completed. Membership of a company may keep on changing
from time to time but that does not affect life of the company. Insolvency or Death of
member does not affect the existence of the company.

Separate Property:
A company is a distinct legal entity. The company's property is its own. A member
cannot claim to be owner of the company's property during the existence of the
company.
 Transferability of Shares:
Shares in a company are freely transferable, subject to certain conditions, such that no
share-holder is permanently or necessarily wedded to a company. When a member
transfers his shares to another person, the transferee steps into the shoes of the
transferor and acquires all the rights of the transferor in respect of those shares.

Common Seal:
A company is an artificial person and does not have a physical presence. Thus, it acts
through its Board of Directors for carrying out its activities and entering into various
agreements. Such contracts must be under the seal of the company. The common seal is
the official signature of the company. The name of the company must be engraved on
the common seal. Any document not bearing the seal of the company may not be
accepted as authentic and may not have any legal force.

Capacity to sue and being sued:

A company can sue or be sued in its own name as distinct from its members.

Separate Management:
A company is administered and managed by its managerial personnel i.e. the Board of
Directors. The shareholders are simply the holders of the shares in the company and
need not be necessarily the managers of the company.

One Share-One Vote:

The principle of voting in a company is one share-one vote i.e. if a person has 10 shares,
he has 10 votes in the company. This is in direct distinction to the voting principle of a
co-operative society where the "One Member - One Vote" principle applies i.e.
irrespective of the number of shares held, one member has only one vote.
Q.2 Examine how the company can be classified into various kinds as per Companies Act,
1956
(A) On the basis of incorporation - (i) Registered companies, (ii) Statutory companies
(B) On the basis of Liability - (i) Company limited by shares, (ii) Company limited by
guarantee, (iii) Companies with unlimited liability
(C) On the basis of number of members - (i) Public company, (ii) Private company
(D) On the basis of Ownership - (i) Government company, (ii) Non- Government company
(E) On the basis of Control - (i) Holding company, (ii) Subsidiary company

(F) Foreign Company

(G) One man Company

Q.3 Briefly describe the various documents to be filed with the registrar for incorporation
of company
a) Memorandum of association duly signed by the subscribers
b) Article of association, if any, signed by the subscribers t the Memorandum of
association. A public company limited by shares may not have its own Article of
association, it may adopt Table A in the schedule I to the Act.
c) A copy of the agreement, if any, which the company proposes to enter into with any
individual for his appointment as managing or whole-time director or manager
d) A written consent of the directors to act in that capacity, if necessary
e) A statutory declaration stating that all the legal requirements of the Act prior to
incorporation have been complied with. Such declaration shall be signed by any of the
following persons….
(i) An advocate f the supreme court or High court
(ii) An attorney or a pleader entitled to appear before a supreme court
(iii) A secretary or a chartered accountant in whole time practice in India, who is
engaged in the formation of the company
(iv) A person named in the articles as a director, manger r secretary f the company
Then within 30 days of the incorporation of company, a notice of the situation of the
registrar office of the company shall be given to the registrar ho shall record the same
Q.4 The memorandum of association is the fundamental law defining the objects and
limiting the powers of the company – Examine
Name Clause - This clause states the company's proposed name. It must end in the word
"limited" if it's a public company or "private limited" if it's a private company. It can't be
identical to any existing company's name. It can't allude to the new company doing the
business of an existing company. It should not be misleading in any way.
Registered Office Clause - The registered office clause lists the name of the state where the
company's registered office is physically located. The registered office's physical location
determines which jurisdiction the Registrar of Companies and which court the company
would fall under. It also confirms the company's nationality.
Objects or Objective Clause - Considered the most important in the MOA. It defines and
limits the scope of the company's operations. It details the company's scope of activity for
the members and explains how the members' capital will be used. It protects shareholders
funds and ensures the funds will be used for the specific business purposes for which they
were raised and that they won't be risked in other endeavors.
Object Clause - Explained why the company is establishing. Companies aren't legally allowed
to do any kind of business other than the kind of business that is specifically stated in this
clause. An object clause should contain:
 A list of the main objects the company will be pursuing after it's Incorporated
 Incidental objects that are necessary to achieve the main object
 Any other objects that aren't included in the main objects or incidental object
 Nothing illegal
 Nothing that's against the public interest
 Nothing that's against the country's general rule of law
Liability Clause - The liability clause explains what liability each of the company's members
faces. If the company is limited by shares, the liability that each member faces can be no
more than the face value of shares that he or she holds. If it's a company that's limited by
guarantee, this clause must define how much liability each individual company member
holds. If it's an unlimited company, this particular clause would not be included in the MOA.
Capital Clause - The capital clause lists information about the total capital held by the
proposed company. This amount is called the company's authorized capital. Companies
aren't permitted to collect more money than the amount listed under authorized capital.
The way the capital is divided into equity share capital and preference share capital also
needs to be listed in the capital clause. The number of shares the company puts in equity
share capital and preference share capital, alongside their value, needs to be included in the
MOA.
Association Clause -
The association clause explains that any individual signing the bottom of the MOA wants to
be part of the association that's being formed by the memorandum. The MOA has to be
signed by at least seven people or more if it's a public company. It has to be signed by at
least two or more people if it's a private company. The signatures also have to be affirmed
by witnesses. There can be one witness for all of the signatures, but none of the subscribers
can witness the signatures of the others. All subscribers and witnesses must provide their
addresses and occupations in writing.
Q.5 Discuss the contents of Articles of Association and the limit upon the powers of the
company to alter the Articles of Association.
 Share capital including sub-division, rights of various shareholders, the
relationship of these rights, payment of commission, share certificates.
 Lien of shares
 Calls on shares
 Transfer of shares
 Transmission of shares
 Forfeiture of shares
 Surrender of shares
 Conversion of shares in stock
 Share warrant
 Alteration of capital
 General meetings and proceedings
 Voting rights of members, voting by poll, proxies
 Directors, their appointment, remuneration, qualifications, powers and
proceedings of the boards of directors meetings.
 Dividends and reserves
 Accounts and Audits
 The auditing of a company shall be done subject to the provisions of the articles
of association of the company.
 Borrowing powers
 Winding up

1. Share capital including sub-division, rights of various shareholders, the relationship

of these rights, payment of commission, share certificates.
2. Lien of shares: - to retain possession of shares incase the member is unable to pay
his debt to the company.
3. Calls on shares - Calls on shares include the whole or part remaining unpaid on each
share which has to be paid by the shareholders on the company’s demand.
4. Transfer of shares: The articles of association include the procedure for the transfer
of shares by the shareholder to the transferee.
5. Transmission of shares: Transmission includes devolution of title by death,
succession, marriage, insolvency, etc. It is not voluntary but is in fact brought about
by operation of law.
 6. Forfeiture of shares: The articles of association provide for the forfeiture of shares if
the purchase requirements such as paying any allotment or call money, are not met
with.
7. Surrender of shares: Surrender of shares is when the shareholders voluntary return
the shares they own to the company.
8. Conversion of shares in stock: In consonance with the articles of association, the
company can convert the shares into stock by an ordinary resolution in a general
meeting.
9. Share warrant: A share warrant is a bearer document relating to the title of shares
and cannot be issued by private companies; only public limited companies can issue
a share warrant.
10. Alteration of capital: Increase, decrease or rearrangement of capital must be done as
the articles of association provide.
11. General meetings and proceedings: All the provisions relating to the general
meetings and the manner in which they are to be conducted are to be contained in
the articles of association.
12. Voting rights of members, voting by poll, proxies: The members right to vote on
certain company matters and the manner in which voting can be done is provided in
the articles of association.
13. Directors, their appointment, remuneration, qualifications, powers and proceedings
of the boards of directors meetings.
14. Dividends and reserves: The articles of association of a company also provide for the
distribution of dividend to the shareholders.
15. Accounts and Audits: The auditing of a company shall be done subject to the
provisions of the articles of association of the company.
16. Borrowing powers: Every company has powers to However, this must be done
according to the articles of association of the company.
17. Winding up: Provisions relating to the winding up of the company finds mention in
articles of association of the company and must be done accordingly.

Limitations to alter the articles of Association

 Articles can be altered only by a special resolution
 Alteration can neither be beyond the provisions of the companies Act nor the
memorandum of association.
 Alteration of articles seeking to take away the company’s power to alter its articles
would be void as being contrary to the provisions of the Act
 Alternation seeking to impose an additional liability on a member of the company
after the date on which he became a member
  Alteration should not be illegal or against public policy besides not being contrary to
any other statute in force.
 The power to alter the Articles must be exercised by the shareholders in good faith
for the benefit of the company as a whole
 Certain provisions of the Articles cannot be altered except with the prior approval of
the Central Government. These include increasing the remuneration of directors of
public company not in accordance with Schedule XIII of the Act, conversion of a
public company into a private company etc.
 Company can alter its articles even if it causes a breach of an agreement with the
outsider. Company cannot be prevented by injunction from altering its articles which
constitute a breach of contract although it may be liable to pay damages, if it acts
upon them.
Q.6 Explain the different kinds of meetings of the shareholders of a company?
Kinds of Company Meetings
The meetings of a company can be broadly classified into four kinds.
1. Meeting of the Share Holders
The meetings of the shareholders can be further classified into four kinds namely,
a) Statutory Meeting - Statutory meeting is the first general meeting of the company. It is
conducted only once in the lifetime of the company. A private company or a public
company having no share capital need not conduct a statutory meeting.
b) Annual General Meeting - The Annual General Meeting is one of the important meetings
of a company. It is usually held once in a year to transact the ordinary business of the
company.
c) Extraordinary General Meeting - All other general meetings other than these two are
called Extraordinary General Meetings., these meetings are convened to deal with all
the extraordinary matters, which fall outside the usual business of the Annual General
Meetings, which cannot be postponed till the next Annual General Meeting. Every
business transacted at these meetings is called Special Business.
The following persons are authorized to convene an extraordinary general meeting.
 The Board of Directors,
 The Requisitionists.
 The National Company Law Tribunal.
 Any Director or any two Members
d) Class Meeting - Class meetings are those meetings, which are held by the shareholders
of a particular class of shares e.g. preference shareholders or debenture holders. Class
meetings are generally conducted when it is proposed to alter, vary or affect the rights
of a particular class of shareholders
2. Meetings of the Directors - Meetings of directors are called Board Meetings. These are
the most important as well as the most frequently held meetings of the company. It is only
at these meetings that all important matters relating to the company and its policies are
discussed and decided upon. The directors of most companies frame rules concerning how,
where and when they shall meet and how their meetings would be regulated. These rules
are commonly known as Standing Orders.
3. Meetings of Debenture Holders - The debenture holders of a particular class conduct
these meeting. Rules and Regulations regarding the holding of the meetings of the
debenture holders are either entered in the Trust Deed or endorsed on the Debenture Bond
so that they are binding upon the holders of debentures and upon the company.
4. Meetings of the Creditors – held when the company proposes to make a scheme of
arrangements with its creditors. Companies like individuals may sometimes find it necessary
to compromise or make some arrangements with their creditors, In these circumstances, a
meeting of the creditors is necessary

Q.7 Identifying the different modes and procedures for winding up of a company under
Companies Act 2013.
Winding up by the court
Voluntary Winding up

a) Winding up by the tribunal: As per new Companies Act 2013, a company can be wound
up by a tribunal in the below mentioned circumstances:
When the company is unable to pay its debts
If the company has by special resolution resolved that the company be wound up by the
tribunal.
If the company has acted against the interest of the integrity or morality of India, security of
the state, or has spoiled any kind of friendly relations with foreign or neighboring countries.
If the company has not filled its financial statements or annual returns for preceding 5
consecutive financial years.
If the tribunal by any means finds that it is just & equitable that the company should be
wound up.
If the company in any way is indulged in fraudulent activities or any other unlawful business,
or any person or management connected with the formation of company is found guilty of
fraud, or any kind of misconduct.
Filling up winding up petition: Section 272 provides that a winding up petition is to be filed
in the prescribed form no 1, 2 or 3 whichever is applicable and it is to be submitted in 3 sets.
The petition for compulsory winding up can be presented by the following persons:
The company
The creditors ; or
Any contributory or contributories
By the central or state govt.
By the registrar of any person authorized by central govt. for that purpose

Final Order and its Contents: The tribunal after hearing the petition has the power to
dismiss it or to make an interim order as it think appropriate or it can appoint the
provisional liquidator of the company till the passing of winding up order. An order for
winding up is given in form 11.

b) Voluntary winding up of a company: The company can be wound up voluntarily by the

mutual decision of members of the company, if:
The company passes a Special Resolution stating about the winding up of the company.
The company in its general meeting passes a resolution for winding up as a result of expiry
of the period of its duration as fixed by its Articles of Association or at the occurrence of any
such event where the articles provide for dissolution of company.

Procedure for Voluntary Winding Up:

Conduct a board meeting with 2 Directors and thereby pass a resolution with a declaration
given by directors that they are of the opinion that company has no debt or it will be able to
pay its debt after utilizing all the proceeds from sale of its assets.

Issues notices in writing for calling of a General Meeting proposing the resolution along with
the explanatory statement.

In General Meeting pass the ordinary resolution for the purpose of winding up by ordinary
majority or special resolution by 3/4th majority. The winding up shall be started from the
date of passing the resolution.

Conduct a meeting of creditors after passing the resolution, if majority creditors are of the
opinion that winding up of the company is beneficial for all parties then company can be
wound up voluntarily.
Within 10 days of passing the resolution, file a notice with the registrar for appointment of
liquidator.

Within 14 days of passing such resolution, give a notice of the resolution in the official
gazette and also advertise in a newspaper.

Within 30 days of General meeting, file certified copies of ordinary or special resolution
passed in general meeting.

Wind up the affairs of the company and prepare the liquidators account and get the same
audited.

Conduct a General Meeting of the company.

In that General Meeting pass a special resolution for disposal of books and all necessary
documents of the company, when the affairs of the company are totally wound up and it is
about to dissolve.

Within 15 days of final General Meeting of the company, submit a copy of accounts and file
an application to the tribunal for passing an order for dissolution.

If the tribunal is of the opinion that the accounts are in order and all the necessary
compliances have been fulfilled, the tribunal shall pass an order for dissolving the company
within 60 days of receiving such application.

The appointed liquidator would then file a copy of order with the registrar.

After receiving the order passed by tribunal, the registrar then publish a notice in the official
Gazette declaring that the company is dissolved.

Q.8 Explain the salient features of limited liability partnership

LLP is a body corporate
According to Section 3 of the Limited Liability Partnership Act (LLP Act), 2008, an LLP is a
body corporate formed and incorporated under the Act. It is a legal entity separate from its
partners.
Perpetual Succession
Unlike a partnership firm, a limited liability partnership can continue its existence even after
the retirement, insanity, insolvency or even death of one or more partners. Further, it can
enter into contracts and hold property in its name.
Separate Legal Entity
It is a separate legal entity. Further, it is completely liable for its assets. Also, the liability of
the partners is limited to their contribution in the LLP. Hence, the creditors of the limited
liability partnership are not the creditors of individual partners.
Mutual Agency
Another difference between an LLP and a partnership firm is that independent or
unauthorized actions of one partner do not make the other partners liable. All partners are
agents of the LLP and the actions of one partner do not bind the others.
LLP Agreement
The rights and duties of all partners are governed by an agreement between them. Also, the
partners can devise the agreement as per their choice. If such an agreement is not made,
then the Act governs the mutual rights and duties of all partners.
Artificial Legal Person
For all legal purposes, an LLP is an artificial legal person. It is created by a legal process and
has all the rights of an individual. It is invisible, intangible and immortal but not fictitious
since it exists.
Common Seal
If the partners decide, the LLP can have a common seal [Section 14(c)]. It is not mandatory
though. However, if it decides to have a seal, then it is necessary that the seal remains
under the custody of a responsible official. Further, the common seal can be affixed only in
the presence of at least two designated partners of the LLP.
Limited Liability
According to Section 26 of the Act, every partner is an agent of the LLP for the purpose of
the business of the entity. However, he is not an agent of other partners. Further, the
liability of each partner is limited to his agreed contribution in the Limited Liability
Partnership.
Minimum and Maximum Number of Partners
Every Limited Liability Partnership must have at least two partners and at least two
individuals as designated partners. At any time, at least one designated partner should be
resident in India. There is no maximum limit on the number of maximum partners in the
entity.
Management of Business
The partners of the Limited Liability Partnership can manage its business. However, only the
designated partners are responsible for legal compliances.
Business for Profit Only
A Limited Liability Partnership cannot be formed for charitable or non-profit purposes. It is
essential that the entity is formed to carry on a lawful business with a view to earning a
profit.
Investigation
The power to investigate the affairs of a Limited Liability Partnership resides with the
Central Government. Further, they can appoint a competent authority for the same.
Compromise or Arrangement
Any compromise or arrangement like a merger or amalgamation needs to be in accordance
with the Act.

Q.9 Identify the procedure followed to form a limited liability partnership

Digital Signature Certificate (DSC)

Before initiating the process of registration, you must apply for the digital signature of the
designated partners of the proposed LLP. This is because all the documents for LLP are filed
online and are required to be digitally signed.
Director Identification Number (DIN)
You have to apply for the DIN of all the designated partners or those intending to be
designated partner of the proposed LLP.
The application for allotment of DIN has to be made in Form DIR-3. You have to attach the
scanned copy of documents (usually Aadhaar and PAN) to the form. The form shall be
signed by a Company Secretary in full- time employment of the company or by the
Managing Director/Director/CEO/CFO of the existing company in which the applicant shall
be appointed as a director.

Step 3: Reservation of Name

Limited Liability Partnership-Reserve Unique Name is filed for the reservation of name of
proposed LLP which shall be processed by the Central Registration Centre under Non-STP.
But before quoting the name in the form, it is recommended that you use the free name
search facility on MCA portal. The system will provide the list of closely resembling names of
existing companies/LLPs based on the search criteria filled up.
This will help you in choosing names not similar to already existing names. The registrar will
approve the name only if the name is not undesirable in the opinion of the Central
Government and does not resemble any existing partnership firm or an LLP or a body
corporate or a trademark. The form RUN-LLP has to be accompanied with fees as per
Annexure ‘A’ which may be either approved/rejected by the registrar. A re-submission of
the form shall be allowed to be made within 15 days for rectifying the defects. There is a
provision to provide for 2 proposed names of the LLP.
Step 4: Incorporation of LLP
1. The form used for incorporation is FiLLiP(Form for incorporation of Limited Liability
Partnership) which shall be filed with the Registrar who has a jurisdiction over the
state in which the registered office of the LLP is situated. The form will be an
integrated form.
2. Fees as per Annexure ‘A’ shall be paid.
3. This form also provides for applying for allotment of DPIN, if an individual who is to
be appointed as a designated partner does not have a DPIN or DIN.
4. The application for allotment shall be allowed to be made by two individuals only.
5. The application for reservation may be made through FiLLiP too.
6. If the name that is applied for is approved, then this approved and reserved name
shall be filled as the proposed name of the LLP

Step 5: File Limited Liability Partnership Agreement

LLP agreement governs the mutual rights and duties amongst the partners and also
between the LLP and its partners.
 LLP agreement must be filed in form 3 online on MCA Portal.
 Form 3 for LLP agreement has to be filed within 30 days of the date of incorporation.
 The LLP Agreement has to be printed on Stamp Paper. The value of Stamp Paper is
different for every state.
Q.10 Discuss the procedures for altering the name clause and situation clause of
Memorandum of Association.
ALTERATION OF THE NAME CLAUSE IN MOA
The procedure to be followed in regard to the change of the name under different
circumstances is as follows.
General change of the name
The name of the company can be altered at any time. For the purpose, a special resolution
has to be passed and a written approval of the Central Government is to be obtained. A
copy of the special resolution should be filed with the Registrar within 30 days of its passing.
Change of name under the direction of the central government
If by mistake or otherwise a company has been registered by a name, which the Central
Government thinks, is identical with or closely resembles the name of an existing company,
the Government may direct the company to change its name. The direction of the Central
Government is required to be complied with, within a period of 3 months from the date
thereof.
Any default in complying with the direction by the Government, render the company and its
officers in default liable for punishment with fine which may extend to Rs.1,000 for every
day during which the default continues. The following procedure should be followed.
The company should pass an ordinary resolution.
The company should get the written approval of the Central Government.
A copy of the ordinary resolution has to be filed with the Registrar within 30 days of its date.
Addition or Deletion
On conversion of a private limited company into a public limited company and vice versa,
the addition or deletion of the word ‘Private’ is to be made. It requires no Government’s
approval.
Minor Mistakes
A minor mistakes like spelling mistakes etc. may be altered by an ordinary resolution.
2. ALTERATION OF THE SITUATION CLAUSE OF MOA
The procedure for altering the situation clause can be studied under the following heads:
Change of registered office in the same town or village
A mere resolution of the Board of Directors is enough for the change. A notice of the change
should be filed with the Registrar within 30 days of the change. This does not involve
alteration of Memorandum
Change of registered office from one place to another within a state
A company can change the place of its registered office from one place to another within a
State, if the Regional Director confirms it. For this purpose, the company has to make an
application to the Regional Director for confirmation. This confirmation shall be
communicated to the company within four weeks. The company shall then file with the
Registrar a certified copy of the confirmation by the Regional Director, within 2 months from
the date of confirmation, together with a printed copy of the Memorandum of Association
as altered. The Registrar shall register the same within one month from the date of filing of
such document.
Change of registered office from one state to another
The change of registered office from one state to another state involves alteration of
Memorandum, and the change can be effected by a special resolution of the company
which must be confirmed by the Central Government.
The following procedure should be followed for the purpose:
A special resolution must be passed.
A copy of the special resolution should be filed with the Registrar within one month of its
passing.
The alteration is to be confirmed by the Central Government.
A certified copy of the Central Government’s order and a copy of the altered Memorandum
should be filed with the Registrar within 3 months