Procedure for Change of name of a Private Limited Company

CA Pratik Anand

Procedure for Change of name of a private limited company as per Companies Act’ 2013

This article describes the procedure for change of name of the company. The change in name entails change in the Memorandum and articles of association of the company.

The memorandum of Association (MOA) of any Company as per Companies Act’ 2013 has five clauses:

• Name Clause
• Registered Office clause
• Object Clause
• Liability Clause
• Capital Clause

Any of these clauses can be altered by the Company as and when it wants to do so. These clauses can be altered by passing a special resolution of the shareholders of the Company except in case of the capital clause which can be altered by passing an ordinary resolution by the shareholders of the Company.

The articles of Association of the company have to be changed also in case of change of name of the company by passing a special resolution.

Ques: What is the procedure for change of name of the company?

Ans: The procedure for change of name is as follows:

Step 1:  First call a board meeting for approval of change in name. The agenda of the board meeting will be to approve the change in name, to apply for name availability to the Registrar and then to call an EGM to get the shareholder’s approval for change in name.

The board meeting should be called by giving at least 7 days notice. The board will suggest proposed new names and will set the agenda for EGM.

Sample Board Resolution: 

Change in Name of the Company

RESOLVED THAT pursuant to the provisions of section 13 and other applicable provisions of the Companies Act, 2013 if any and the rules framed there under, and subject to the approval of the Registrar of Companies, NCT of Delhi & Haryana and the approval of the members, the consent of the board be and is hereby accorded to change the name of the company from ___________________ to __________________ or any other name as may be approved by the Registrar.

FURTHER RESOLVED THAT for the purpose of giving effect to this resolution, _____________, Director of the Company be and is hereby authorized, on behalf of the Company, to make an application to the MCA for ascertaining availability of proposed name and to do all acts, deeds, matters and things as deem necessary, proper or desirable and to sign and execute all necessary documents, applications and returns, e-forms for the purpose of giving effect to the aforesaid resolution.

Step 2: Check Company Name Availability

Once a resolution is passed for ascertaining availability of proposed company name, the authorized director can make a name availability application to the jurisdictional ROC in form INC-1.

The Board resolution passed in step 1 will be an attachment to form INC-1.

Step 3:   Once the name availability application is approved by the Registrar by issuing a certificate of name availability, the board will issue notice of Extraordinary Meeting to all Members, Directors and the Auditors of the company in accordance with the provisions of Section 101 of the Companies Act, 2013.

The Notice contains the date, time and venue of the EGM. The notice will be accompanied by an explanatory statement detailing the reasons for change in name. Interest of the director in the resolution should be disclosed in the explanatory statement. The Notice shall be issued at least 21 clear days before the EGM and keeping in mind that the name availability is applicable for only 60 days from the date mentioned the name availability certificate.

Step 4: The next step is to hold an Extraordinary General Meeting at the time, place and venue as given in the notice and to pass the necessary Special Resolution under section 13 of the Companies Act, 2013, for change in name of the company.

Sample Shareholders Resolution: 

Change in name of the Company

“RESOLVED THAT pursuant to the provisions of section 13 and other applicable provisions of the Companies Act, 2013 if any and the rules framed there under, and subject to the approval of the Registrar of Companies, NCT of Delhi & Haryana the consent of members be and is hereby accorded to change the name of the company from __________________ PRIVATE LIMITED to _________________ PRIVATE LIMITED.

“RESOLVED FURTHER THAT Clause I of the Memorandum of Association of the Company be substituted by the following:

‘The Name of the company is ________________ PRIVATE LIMITED”.

RESOLVED FURTHER THAT Mr. _________________, Director of the Company be & is hereby authorised on behalf of the Company, to prepare, sign, execute, file & submit the Form MGT-14, Form INC-24, other necessary

E-forms, applications, documents & returns with Registrar of Companies, Ministry of Corporate of Affairs NCT of Delhi and Haryana & to do all acts, deeds & things as may deem necessary, proper or desirable for the purpose of giving effect to above resolution

Step 5: Filing with the Registrar of companies               

The special resolution passed at the EGM also needs to be filed with the Registrar within 30 days of passing the resolution. Form MGT-14 is required to be filed for filing the resolution with the Registrar. Form MGT-14 contains details about the special resolution passed.

Once the necessary special resolution is filed with Registrar in form MGT-14, the company needs to file an application for change of name of the company with the Central Government in Form INC-24 along with the requisite fee.

Here, it is to be noted that form INC-24 is to be filed after form MGT-14 as the form INC-24 specifically asks for the SRN of form MGT-14 filed with the registrar. INC-24 also asks for SRN of INC-1 filed with the registrar as given in step-2 above.

INC-24 also asks reasons for change of name of the company and details about the number of members who attended the EGM and those who voted for and against the resolution and their shareholding in the company.

Attachments with form MGT-14

• Certified copy of the resolution
• Notice of Extra ordinary General Meeting (EGM)
• Explanatory statement to the notice
• Altered Memorandum of Association
• Altered articles of Association

Attachments with form INC-24

• Minutes of the members’ meeting

Step 6: Registration of change in name by the Registrar

If the Registrar of Companies is satisfied with the company’s name change application, the Registrar would issue a new certificate of incorporation. It is important to note that the company name change is said to be complete and effective on issuance of new incorporation certificate by the Registrar of Companies.

The registrar will also approve the resolution filed in Form MGT-14.

Step 7: Subsequent to the issuance of the new incorporation certificate, steps must be taken to incorporate the new company name in all the copies of Memorandum of Association and Articles of Association.

Another important point to remember

Here another thing to be kept in mind while altering the name clause of Memorandum is that the Registrar may ask for adoption of new set of memorandum and articles in line with the new Companies Act’2013.

The statutory backing for adopting new set of memorandum and articles is given in Section 6 of the Companies Act’2013 which is given as follows:

“(b) Any provision contained in the memorandum, articles, agreement or resolution shall, to the extent to which it is repugnant to the provisions of this Act, become or be void, as the case may be.”

Therefore, the provisions under the old memorandum/articles may be repugnant i.e contradictory/inconsistent with the provisions of the Companies Act’2013 and hence may be termed as void therefore it is advisable to adopt new set of memorandum and articles as per Companies Act’2013.

Major reason for that is the change in format of Memorandum and articles under the previous act and the new act’2013.

Major difference between the memorandum under Companies Act’1956 and 2013 is the object clause. While the Object clause under the 1956 Format included three sub-clauses:

♣ Main objects,

♣ Incidental and ancillary objects and

♣ Other objects

The format under the Companies Act’2013 includes only two sub clauses:

♣ THE OBJECTS TO BE PURSUED BY THE COMPANY ON ITS INCORPORATION i.e Main Objects.

♣ MATTERS WHICH ARE NECESSARY FOR FURTHERANCE OF THE MAIN OBJECTS.

Therefore while altering the name clause it is advisable for the company:

♣ To amend the title of incidental object Clause of the Memorandum Of Association by passing the following resolution:

“Clause III (B) of the objects that are incidental or ancillary to the attainment of the main objects of the Memorandum of Association be and hereby replaced with the title “MATTERS WHICH ARE NECESSARY FOR FURTHERANCE OF THE OBJECTS SPECIFIED IN CLAUSE III (A) ARE:-“

♣ To Delete the other objects clause of the Memorandum Of Association by passing the following resolution:

“Pursuant to the provisions of Section 4, 13 and all other applicable provisions, if any, of the Companies Act, 2013, (including any amendment thereto or re-enactment thereof), and subject to necessary approval(s) if any, from the competent authorities, the Other Objects Clause of the Memorandum of Association of the Company be removed by completely deleting the clause III (C)”.

ADOPTION OF NEW SET OF ARTICLES OF ASSOCIATION

Pursuant to the provisions of Section 14 and other applicable provisions, if any, of the Companies Act, 2013, (including any amendment thereto or re-enactment thereof), the Articles of Association of the Company should be altered thereby replacing all the existing regulations with the new regulations.                                      

Hope you find the above information in order.

(The author is a CA in practice at Delhi and can be contacted at: E-mail: [email protected], Mobile: +91-9953199493)