Change in Name of Company (FAQs) Updated Up-to 23/05/2021
Q.1 What are reasons for alteration of Name Clause of the Company?
Ans.
-Change of Name by Shareholders (Voluntary);
-Change of Name due to order of the Central Government.
Q.2 When Change in Name of Company is not allowed?
Ans.
- The change of name shall not be allowed to a company which: –
a. has not filed annual returns or financial statements;
b. 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.
Q.3 When can Central Government issue order for Change in Name of Company?
Ans.
- When Central Government is in opinion that the name is identical with or too nearly resembles the name of: –
a. Existing Company;
b. on an application by a registered proprietor of a trade mark that the name is identical with or too nearly resembles to his registered trade mark.
Q.4 Within what time-frame Company should Change its Name from Central Government Order?
Ans.
- 3 (Three) Months
Q.5 What all points to kept in mind while selecting a new name?
Ans.
- The proposed name should not resemble too nearly with name of existing company;
- Further, it should not: –
a. Be prohibited under Emblems and Names (Prevention and Improper Use) Act, 1950;
b. Be Registered Trademark;
c. Be offensive to any section of the people;
d. Be identical with or too nearly resembles the name of a limited liability partnership;
e. Be identical with or too nearly resembles with a name which is for the time being reserved;
f. resembles closely the popular or abbreviated description of an existing company or limited liability partnership;
g. indicate separate type of business constitution or legal person or any connotation thereof; (e.g., HUF, Trust etc.)
h. include word “British India”
i. imply association or connection with an embassy or consulate of a foreign government;
j. include or imply association or connection with or patronage of a national hero or any person held in high esteem or important personages who occupied or are occupying important positions in the Government;
k. be identical to the name of a company dissolved as a result of liquidation proceeding and a period of two years has not elapsed;
l. be identical with the name of a company which is struck off and 20 (Twenty) Years has not elapsed;
m. be name of LLP Struck off or in liquidation and 5 (Five) Years have not elapsed;
n. include words such as ‘Insurance’, ‘Bank’, ‘Stock Exchange’, ‘Venture Capital’, ‘Asset Management’, ‘Nidhi’, ‘Mutual Fund’, etc., unless a declaration is submitted by the applicant that the requirements mandated by the respective regulator, such as IRDA, RBI, SEBI, MCA, etc. have been complied with by the applicant;
o.include the word “State”, in case the company is not a Government company;
p. contain only the name of a continent, country, State, city such as Asia limited, Germany Limited, Haryana Limited or Mysore Limited;
q. Use descriptive names, where the name merely consists of commonly used words to describe an activity;
r. include name of any foreign country or any city in a foreign country, the same shall be allowed if the applicant produces any proof of significance of business relations with such foreign country;
s. be name which has been released from the register of companies upon change of name of a company and three years have not elapsed;
t. use name which is indicative of activities financing, leasing, chit fund, investments, securities or combination thereof unless its main object is related to it.
Further,
- if its Section 8 company then is should include the words Foundation, Forum, Association, Federation, Chambers, Confederation, Council, Electoral Trust and the like, etc.;
- if its Nidhi company it should have the last words “Nidhi Limited” as a part of its name;
Q.6 What shall be effect of Change in Name?
Ans.
- It will not affect Rights and Liabilities of the Company;
- It will not render any legal proceedings defective by or against it;
- Company Shall have right to execute decree in new name;
- Former name should be painted, printed or affixed for 2 (Two) Years in letter head, bills and official publication etc.
Q.7 What is Procedure for Change in Name of a Company?
Ans.
Note:
For Change in Name as per Central Government Order Ordinary Resolution is to be passed.
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(Author – CS Nayan Pitroda proprietor of Pitroda Nayan & Co., Company Secretary in Practice can be contacted at +91 8866021210 and/ cs.nayanpitroda@gmail.com)
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