As discussed in our previous article about Alteration to Memorandum of Association of the Company, the MOA of Company includes following clauses:
- Name Clause where name of the Company is mentioned
- Situation Clause where jurisdiction of the ROC and state where Registered Office of the Company is situated is mentioned
- Object Clause where the main activities for which the Company is incorporated is mentioned
- Liability Clause where the liability of the members is mentioned
- Capital Clause where the Authorized Capital of the company and its division is mentioned.
- Subscription Clause where the number of shares subscribed by every subscriber is mentioned
Object clause of Memorandum of Association specifies the objectives for which the Company is Incorporated. A Company cannot carryon any business other than that mentioned in the Object Clause of the Memorandum of Association. Companies may require alteration of object clause of Memorandum in case they are entering into new line of business or diversifying their activities.
For alteration of object clause of Memorandum of association, approval from shareholders of the Company is required in form of Special Resolution passed in General Meeting of the Company. Step by step procedure for change of Object Clause of Company is explained below:
Step 1: Convene meeting of Board of Directors
A meeting of Board of Directors is convened by issuing notice to call board meeting in accordance with the provisions of Companies Act, 2013. At the Board Meeting few resolutions regarding change of object are passed which includes in principle approval of the Board of Directors to change Object Clause of the Company, fix date of General Meeting, approve notice of General Meeting with agenda and explanatory statement and authorizing Director or Company Secretary of the Company to issue notice of General Meeting.
Step 2: Issue of notice of General Meeting
Notice of General Meeting is issued to the members, auditors and directors of the Company.
Step 3: Hold General Meeting of Company
Hold General Meeting of the Company on the date specified in the Notice of General Meeting and pass Special Resolution as per the provisions of Section 13(1) of the Companies Act, 2013.
Step 4: Approval from Registrar of Companies
Notice of General Meeting, altered Memorandum of Association, extract of Special Resolution passed at the General Meeting of the Company with other requisite documents is filed with the Registrar of Companies in form MGT 14. The Registrar of Companies shall within 30 days from date of filing of MGT 14, shall give its approval, if all the documents are in order.
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