IDENTICAL NAME, COPIES TO MEMBERS, SHARES IN HOLDING CO.

IDENTICAL NAME, COPIES TO MEMBERS, SHARES IN HOLDING CO.

Section 16, Rectification of name of company

In case of identical name:

If in the opinion of central government, the name of the company is identical with or too nearly resembles the name by which a company in existence had been previously registered, whether under this Act or any previous company law, it may direct the company to change its name and the company shall change its name or new name, as the case may be, within a period of three months from the issue of such direction.

The company can do the same by passing an ordinary resolution for this purpose.

In case of identical trademark:

If any registered proprietor submits an application to the central government that name is identical with or too nearly resembles to a registered trade mark of such proprietor under the Trade Marks Act, 1999, within three years of incorporation or registration or change of name of the company, whether under this Act or any previous company law, in the opinion of the Central Government, is identical with or too nearly resembles to an existing trade mark, it may direct the company to change its name and the company shall change its name or new name, as the case may be, within a period of six months from the issue of such direction.

After the change in name, the company shall within a period of fifteen days from the date of such change, give notice of the change to the Registrar along with the order of the Central Government, who shall carry out necessary changes in the certificate of incorporation and the memorandum.

Penalty:

If a company does not comply with the directions of the central government, the company shall be punishable with fine of one thousand rupees for every day during which the default continues and every officer who is in default shall be punishable with fine which shall not be less than five thousand rupees but which may extend to one lakh rupees.

Section 17, Copies of memorandum, articles, etc., to be given to members

On the request of the member, the company has to send him the following documents subject to the payment of required fee:

  • The memorandum;
  • The articles; and
  • Every agreement and every resolution referred to in sub-section (1) of section 117, if and in so far as they have not been embodied in the memorandum or articles.

The provisions of the section 117 will be discussed in detail in the further parts. For your brief understanding, hereby it is stated that this section deals with the resolutions & explanatory statements.

Penalty:

If a company makes any default in providing the copies to the members as stated, the company and every officer of the company who is in default shall be liable for each default, to a penalty of one thousand rupees for each day during which such default continues or one lakh rupees, whichever is less.

Section 19, Subsidiary company not to hold shares in its holding company.

 As per the provisions of this act, No company either by itself or through its nominees hold any shares in its holding company. Also, the holding company shall not transfers shall allot or transfer its shares to any of its subsidiary companies.

Any such allotment or transfer of shares of a company to its subsidiary company shall be void.

Exceptions (Non – Applicability of this section):

  1. where the subsidiary company holds such shares as the legal representative of a deceased member of the holding company; or
  2. where the subsidiary company holds such shares as a trustee; or
  3. where the subsidiary company is a shareholder even before it became a subsidiary company of the holding company.

Important: The above mentioned 3 subsidiaries companies (legal representative, trustee, shareholder) shall have a right to vote at a meeting of the holding company only in respect of the shares held by it as legal representative, trustee, shareholder.

In the case of holding company which is a company limited by guarantee or an unlimited company, not having a share capital, the word share shall be taken interest of its members, whatever be the form of interest.

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