Shifting of Registered Office of a company from one state to another is one of the significant organizational decision. This entire process is governed under the provisions Section 12 and Section 13 of Companies Act, 2013 read with Rule 30 of Companies (Incorporation) Rules, 2013. Changing of Registered Office is one of the strategic decision taken by the Company, this change allows the company to expand its business for better opportunities, access the new markets, get benefitted by favourable state policies. Nevertheless the process of shifting needs careful planning, approval of shareholders and sanction from the Regional Director, making it essential to understand the legal framework involved. It may be noted that shifting of registered office from one state to another state also involves shifting from jurisdiction of one ROC to another ROC except those case where two states where two states have common ROC.
LEGAL PROVISIONS FOR SHIFTING THE REGISTERED OFFICE FROM ONE STATE TO ANOTHER.
Section 13 of Companies Act, 2013 – Alteration of Memorandum
- As per Section 13(1), a company can alter its Memorandum of Association (MoA) by passing a Special Resolution in a general meeting.
- As per Section 13(4), whenever there is a change in situation clause in MoA prior approval of Central Government is mandatory. This approval is obtained by the Regional Director, MCA.
The reason behind such approval is because in such shifting alters the jurisdiction of concerned Registrar of Companies (RoC) which will have a significant implication on taxation, regulatory compliances and operational oversight.
- As per Section 13(5), the Central Government shall dispose off the application made under section 13(4) of the Companies Act, 2013 within a period of 60 days. Before granting its approval, the Central Government must ensure that either the Company has obtained consents from creditors, debentuteholders or other concerned person or it has made sufficient provision to discharge all of its debts and obligations or provided adequate security for such discharge.
Rule 30 of Companies (Incorporation) Rules, 2014 – Shifting of Registered office from one State or Union Territory to another state
- The Company must file e-form INC-23 with Regional Director for seeking approval for alteration of memorandum with regard to the change of place of the registered office from one State Government or Union territory to another, along with:
- a copy of Memorandum of Association, with proposed alterations
- a copy of the minutes of the general meeting at which the resolution authorising such alteration was passed, giving details of the number of votes cast in favour or against the resolution
- a copy of Board Resolution or Power of Attorney or the executed vakalatnama, as the case may be
- a list of creditors and debenture holders, drawn up to the latest practicable date preceding the date of filing of application by not more than one month.
- A declaration by the directors confirming no-objection from the stakeholders.
- a copy of the acknowledgment of service of a copy of the application with complete annexures to the Registrar and Chief Secretary of the State Government or Union territory where the registered office is situated
- The company shall advertise notice in Form INC-26, one in english newspaper and one in vernacular newspaper (with wide circulation) in the State in which the registered office of the company is situated.
- The copy of advertisement shall be served on the following:
- The Regional Director (immediately on its publication).
- To each creditor and debenture holders
- The Chief secretary of the State
- The Registrar of Companies (RoC)
- To SEBI in case of Listed Company.
- The Copy of Application shall be served to the following:
- The Regional Director.
- The Chief secretary of the State
- The Registrar of Companies (RoC)
- To SEBI in case of Listed Company.
- The RD will assess the application along with the accompanying documents. If no objection is raised by any creditors or regulators then RD may approve the application without a hearing
If any objection is raised, the RD will hold a hearing and direct the company to file an affidavit to record the consensus reached at the hearing, upon executing which, the Central Government shall pass an order approving the shifting, within sixty days of filing the application.
- On RD’s approval the Company must file the order in Form- INC-28.
- Subsequently it must file e-Form INC-22 for the new registered office address.
CHECKLIST FOR SHIFTING THE REGISTERED OFFICE IN TABULAR FORM
| Sr. No. | Particulars | Forms Involved | Timeline |
| 1. | Issue of notice of Board Meeting for:
a. Shifting of Registered office from the one state to another state. b. Alteration of Clause II of Memorandum of Association of the Company c. Fix up the date, time, and place of the General Meeting for approval of above two agendas by shareholders |
– | T |
| 2. | Holding of the Board Meeting for:
a. Shifting of Registered office the one state to another state. b. Alteration of Clause II of Memorandum of Association of the Company c. Fix up the date, time, and place of the General Meeting for approval of above two agendas by shareholders |
– | T+7 |
| 3. | Issue of notice of Extraordinary general meeting for approval of the following items:
a. Shifting of Registered office from the one state to another state. b. Alteration of Clause II of Memorandum of Association of the Company |
T+7 | |
| 4. | Holding of Extraordinary general meeting for the approval of the following items:
a. Shifting of Registered office from the one state to another state. b. Alteration of Clause II of Memorandum of Association of the Company |
T+32 | |
| 5. | Filing of MGT-14 with RoC along with the copy of the Special Resolutions, explanatory statement and altered Memorandum of Association | MGT- 14 | T+62 |
| 6. | Preparation of List of creditors and Debenture holders | Should not be older than 1 month preceding the date of application made to Regional Director. | |
| 7. | Publish Advertisement in Newspaper under Rule 30(5)(a) of Companies (Incorporation) Rule, 2014 | Form-INC 26 | Not more than 30 days before the date of filing an application with the Regional Director. |
| 8. | Serving of Newspaper Advertisement: Copy of newspaper advertisement along with cover letter shall be served immediately on its publication by registered post with acknowledgement due:
a. Regional Director. b. On each creditor and debenture holder c. Registrar of Companies d. To SEBI in case of Listed Company |
Forthwith | |
| 9. | Obtaining No-objection from the creditors | Before filing an application (not older than 1 month) | |
| 10. | Serve Complete Application along with annexure to:
a. Regional Director b. Registrar of Companies c. Chief secretary d. SEBI in case of Listed Company |
||
| 11. | Filing application with RoC | GNL-2 | |
| 12. | Filing application with RD | INC-23 | |
| 13. | Upon Receiving approval Order from RD | INC-28 | Within 30 days from the receipt of approval order. |
DOCUMENTS REQUIRED FOR SHIFTING THE REGISTERED OFFICE FROM ONE STATE TO ANOTHER.
| Sr. No. | List of Documents |
| 1. | Copy of Memorandum and Article of Association. |
| 2. | Certified True Copy of Board Resolution |
| 3. | A copy of the Notice convening the General Meeting alongwith relevant Explanatory Statement |
| 4. | Certified True Copy of Special Resolution approving the alteration of memorandum of association by the members of the company. |
| 5. | List of creditors and debenture holders |
| 6. | Affidavit verifying the Petition (duly notarized). |
| 7. | Affidavit verifying list of creditors (duly notarized). |
| 8. | Affidavit by Director verifying non-retrenchment of employees (duly notarized). |
| 9. | Affidavit verifying the Publication of News Paper Notice (duly notarized). |
| 10. | An Affidavit verifying the list of Employees (duly notarized). |
| 11. | Affidavit proving the dispatch and service of notice to the Chief Secretary and Registrar of Companies (duly notarized). |
| 12. | Memorandum of Appearance and Board Resolution authorising the Company Secretary/ Chartered Accountant or Advocate. |
| 13. | Copy of the latest audited balance sheet and profit and loss of the company alongwith auditor and director’s report. |
| 14. | Board Resolution authorising the director to submit the petition. |
CONCLUSION
Shifting of Registered Office from one state to another procedural change, it has a huge impact on a Company’s legal and regulatory framework. As it involves change in Memorandum of Association approval of Central Government is required. To avoid any legal complexities, company must ensure that they are adhering to the provisions of Companies Act, 2013 properly.
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