Changes are inherent, and there is no way one can avoid them. The company name change isn’t a straightforward process, and it seeks a cautious approach. Companies usually go for name modification when they think that the prevailing name no longer fits with Company’s objectives. The Memorandum of Association, aka MOA of a company, contains name clause, object clause, and Registered Office Clause. The Company is bound to alter the name clause accordingly soon after changing the Company’s name. In this article, you will learn about the process of Rectification of the Company’s name in detail.
Facts to Consider Before Deciding the Company’s Name
- The company name plays a considerable role in the brand’s growth & perception. Therefore, it is advisable to pick a name that adheres to minimalism and uniqueness. Also, it should reflect the type of business you are dealing with.
- The second thing to look out for company name on the MCA’s portal.
- Rectification of the Company’s name leads to the significant alteration of the Articles of Association and Memorandum of Association.
- Section 13 of the Companies Act 2013 allows the registered establishments to change their name by passing a special resolution and availing permission from the Central Government.
Section 13 of the Companies Act 2013 talks about the amendment in Company’s MOA applies to all companies. All clauses included in MOA except the capital clause can be amended by following the provision of aforesaid Section by passing a special resolution.
Permission of members via special resolution is an absolute necessity for Rectification of any MOA’s clause. Please note that members’ approval via ordinary resolution as mentioned in Section 61 is required in the case of the capital clause.
Read our article:How can I check the Availability of Company Name in India?
Step by Step Process for Rectification of Company’s Name
Below is the detailed procedure regarding the Rectification of the Company’s name:-
Passing Board Resolution with Consent of Partners
A board meeting must be convened for passing a resolution regarding the Rectification of the Company’s name. In the meeting, BODs will discuss and authenticate the following matters:
- The change in name.
- Authenticating a Director or the CS to check name availability with the Ministry of Corporate Affairs.
- Conducting Extra-Ordinary General Meeting
Checking Name Availability
The company secretary or authorized director can file an application in form INC-1 to MCA for name searching and authentication of the same. The process is more or less the same as the process availed at the time of first name approval.
RoC will send the confirmation regarding the name availability to the applicant via letter. It’s worth noting that this is not final approval. The proposed should be unique in every aspect, and it shouldn’t include the word “state.” The conditions associated with initial name approval will also apply to the new name.
Passing Special Resolution via EGM
Once the name got the MCA’s approval, the Company should convene an extraordinary general meeting. A special resolution will be passed for the name alteration and Rectification of the Memorandum of Association and Articles of Association.
Filing Application with Registrar
A special resolution will be filed with the Registrar of Company within thirty days of passing the resolution. Apart from that, form MGT-14 will also be filed, which encloses the detail regarding special resolution. The applicant must annex followed documents with the said form.
- Altered Memorandum of Association,
- Altered Articles of Association
- Certified copy of Special Resolution,
- Notice of EGM,
- Explanatory statement to EGM
The authority will provide 28 digits Service Request Number (SRN) to the applicant during the application submission.
Subsequent to filing the aforesaid form, the Company must file INC-24 with the RoC for availing permission from the central government for name change along with a standard fee. The applicant is also required to append the SRN of INC-1 in the INC-24 form. In addition to the said form, the applicant must affix the copy of a copy of the minutes of the Extra-Ordinary General Meeting.
Technically, the applicant is required to mention the following details in the INC-24:-
- Reasons of the name change,
- Details about the number of members
- Detail of members who attended the EGM,
- Number of members who cast their vote in meeting.
- Shareholding percentage
Issuance of Incorporation Certification
If the Registrar of Companies (RoC) doesn’t find any discrepancies in the name change application, the Registrar will grant a new incorporation certificate. The new company name will not hold any legal relevancy in the absence of an incorporation certificate.
Incorporating New Company Name in AOA and MOA
The issuance of a certificate of incorporation, make an effort to incorporate the new name in all the copies of Articles of Association, Memorandum of Association, & certification of incorporation granted by the Registrar.
Directions on ‘Suo Moto’ Released by Central Government
Central Government[1] reserves the right to issue suo moto directions to companies for Rectification of the Company’s name under specific circumstances. This order can be communicated anytime either –
- Prior to Company’s registration. or
- Post Registration, or
- Any time during its existence
Registrar of Companies can order for Rectification of the Company’s name. If it is found that the registered Company is using an invalid or duplicate name, then the concerned RoC may order for Rectification of the Company’s name to such Company if it meets all terms that the said name needs to be rectified.
Conclusion
Continuing with the same name is not a wise choice if your Company seeks to expand or enters into a different domain. Whenever you think that your prevailing company name doesn’t fit your goals anymore, replace it with a better one through the process mentioned above. Make sure that the new company name should be catchy, easy to spell, and easy to remember. An irrelevant name cannot pave the roadmap of success for a business.
Read our article:Change in the Name of the Company: Step by Step Procedure
