ALTERATION IN THE MEMORANDUM & ARTICLES OF THE COMPANYAtul Khurana
Section 13, Alteration in Memorandum:
First of all, a special resolution is required to be passed in case the company wants to alter the memorandum.
Alteration in Name:
In case of change in name of the company, the approval of the central government in writing is required except if the change is only in a way of add or delete the word “Private” in the name of the company.
After the change in the name of the company, a certified copy of the order of the Central Government approving the alteration shall be filed by the company with the Registrar of each of the States within such time and in such manner as may be prescribed and then the same has to be entered into the register of companies by the registrar and the registrar will he issue the fresh certificate of incorporation with the new name and the change in the name shall be complete and effective only on the issue of such a certificate.
Change of Registered Office:
In case of change og registered office of the company from one place to other, the approval of central government is again required in writing.
Also, the central government will approve this alteration after proper satisfaction that the creditors, debenture holders and the other persons associated with the company that the sufficient provision has been made by the company either for the due discharge of all its debts and obligations or that adequate security has been provided for such discharge.
In case the money has raised from the public:
A company, which has raised money from public through prospectus and still has any unutilised amount out of the money so raised, shall not change its objects for which it raised the money through prospectus unless a special resolution is passed by the company and:
- The details of such resolution shall also be published in the newspapers (one in English and one in local language) which is in circulation at the place where the registered office of the company is situated and shall also be placed on the website of the company, if any,
- The dissenting (disagreed) shareholders shall be given an opportunity to exit by the promoters and shareholders having control in accordance with regulations to be specified by the Securities and Exchange Board.
Any alteration of the memorandum, in the case of a company limited by guarantee and not having a share capital, purporting (intentioned) to give any person a right to participate in the divisible profits of the company otherwise than as a member, shall be void.
Section 14, Alteration in Articles:
First of all, a special resolution is required to be passed in case the company wants to alter the articles.
The Alteration in the articles also includes:
- A private company into a public company; or
- A public company into a private company
But, if the Private Company alters its articles in such manner that it excludes the restrictions and limitations which are required to be included in the articles of the private company will no longer remain a private company after the date of such alteration.
Also, approval of Tribunal is required in case the public company wants to convert itself into private company
Every alteration of the articles under this section and a copy of the order of the Tribunal approving the alteration shall be filed with the Registrar, together with a printed copy of the altered articles, within a period of fifteen days in such manner as may be prescribed, who shall register the same.
Section 15, Alteration of memorandum or articles to be noted in every copy:
Every alteration made in the memorandum or articles of a company shall be noted in every copy of the memorandum or articles, as the case may be.
Penalty for non-compliance: If a company makes any default in complying with the provisions of this section, the company and every officer who is in default shall be liable to a penalty of one thousand rupees for every copy of the memorandum or articles issued without such alteration.
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