generally deals with memorandum of association

1.  Document which contains the rules
regarding constitution and activities or
objects of the company
 One of the documents to be filed with the
RoC at the time of incorporation
 Fundamental charter of the company
 Foundation on which the structure of the
company is based.
 A co is governed by the MoA

2.  Defines extent of powers of the company.
 Document which sets out the constitution of the
company.
 Public document available for inspection.

3.  In one of the forms in Table B,C,D & E in the
schedule 1 of the companies act.
Table B – ltd by shares
Table C :form for MoA – ltd by guarantee & not
having share capital
Table D: Form for MoA ltd by guarantee &
having share capital
Table E: form for MoA – an unlimited co

4. According to Sec 15 of the Act, MoA
 Must be printed
 Divided into paragraphs
 Numbered consecutively
 Signed by 7 members - public cos
& 2 members – pvt cos
in the presence of at least one witness who
will attest the signature

5.  Shareholder can find out the purpose for which
his money is going to be used by the company
and what risk he is taking in making the
investment.
 To know what are the powers of the company &
what are the range of its activities

6. 1. Name clause
2. Registered office clause(Domicile Clause or
Situation clause)
3. Object clause
4. Liability clause
5. Capital clause
6. Association clause or Subscription clause

7. - States the name of the Co
- A co being a legal person must have a name to
establish its identity- symbol of its personal
existence
- Rule of adopting a name
- Name of the co with ltd or pvt ltd
- Cos formed for the purpose of promotion of art
etc exempted by govt from using ltd or pvt ltd
- Change of name

8.  Specify the state in which the registered office
of the co is to be situated
 Within 30 days of incorporation, notice to be
given to RoC
 All communications to the co must be
addressed to the Registered office
 Shifting of rgstrd office – resolution to be
passed & notice to be given to RoC
 Shifting of rgstrd office from one state to
another – alteration of MoA

9.  Most important clause
 Defines the object of the co & its powers 7
the sphere of its activities
 Object must not be illegal
 Purpose to state its objects are to inform:
- the members in what kind of business their
capital may be used
- persons dealing with the co what its powers
are
* Anything beyond the objects clause is
ultravires & void

10.  Object clause to be divided into 3 sub clauses:
(1)Main objects
(2)Other objects
(3)States to which the objects extend, if the
objects of the co are not contained in one state

11.  Nature of liability
- limited liability
- limited by guarantee

12.  Amount of capital with which the co is
registered
 No: and the value of shares into which it is
divided
 Capital is described as
nominal/authorised/registered capital
 An unltd co having share capital is not
required to include the capital clause –
should be stated in AoA

13.  MoA concludes with the subscription clause
 MoA has to be subscribed by atleast 7 persons –
public co & 2 persons – pvt co
 Signature, no : of shares against his name
 Not less than one share
 The association clause must state that the persons
subscribing their signature to the memorandum
are desirous of forming themselves into an
association in pursuance of the memorandum

14.  MoA – principal document of a company
 Clauses cannot be easily changed
 unalterable charter
 Provision was made in the Act for alteration
in certain cases and to a certain extent
 A co shall not alter the conditions contained
in its MoA except in cases, in the mode, and
to the extent, for which express provision is
made in the Act

15.  If a cacophony unintentionally registers with
a name that resembles that of any other co
 If in the opinion of central govt, the name
resembles
 May change its name by passing a special
resolution and with the permission of the
central government.
 Registrar will change the name, amend the
MOA, issue a new certificate of
incorporation.

16.  When shifting its office from one place to
another within the same state, pass a
special resolution
 Shifting from one locality to another, BoD
can pass resolution
 Shifting from one state to another, pass a
special resolution in a duly convened general
meeting

17.  Change takes effect when confirmed by the
Company Law board
 Copy of resolution to be filed with the registrar
within 30 days of the change.
 Cannot change its registered office from India
to another country.

18.  Carry on its business more economically or efficiently.
 To attain its main purpose by new or improved means.
 To enlarge the local area of its operation.
 To carry on some business combined with existing
business which is advantageous.
 To restrict or abandon any of the objects specified in
the memorandum.
 To sell or dispose of the whole or any part of
undertaking of the company.
 To amalgamate with any other company or body of
persons.

19. Co limited by share capital if permitted by its AOA may
alter its capital clause
 To increase the share capital.
 To consolidate its share capital into shares of
higher denominations.
 To subdivide its share capital into shares of lower
denominations.
 .

20.  To convert its shares into stock.
- A share in a company in one of the units into
which the capital is divided. On the other hand,
a stock is an aggregate of fully paid shares of a
member merged into one fund of equal value.
 To cancel the unissued capital
 To reduce its share capital

21.  Consent in writing by its members for
converting into unlimited liability
 Liability of Director, MD or Manager can be
made unlimited by passing a special
resolution, if article so permits.
 Company shall give notice to Registrar with
in 30 days of passing the resolution.
 Unlimited liability to limited liability – passing
special resolution & sanction of CLB