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Companies Act

Alteration of Memorandum of Association | Object Clause

December 7, 2020 by Team Instabizfilings

Blog Details

Memorandum of association defines the relation of the company with the rights of the members of the company interest and also establishes the relationship of the company with the members.

 

Memorandum of Association (MOA) is the charter document of a company, or we can say a document which governs a company. A company is authorised to do only those activities which are mentioned in the MOA of the company. This document, however, can be amended at any time. In order to amend the MOA, a set procedure has to be followed laid down in the Companies Act, 2013.

 

Company can alter its object clause by way of addition, deletion, modification, substitution, or in any other way, only if it wants:

 

Under Section 13, the Objects Clause can be altered only if the alteration is required to enable the Company:

> To carry on its business more economically or more efficiently

> To attain its main purpose by new or improved means

> To enlarge or change the local area of operation

> To carry on some business which can be combined with the business of the Company

> To amalgamate the Company with any other Company

> To sell or dispose of the whole or any part of the undertakings of the Company

 

STEPS FOR ALTERATION IN OBJECT CLAUSE OF MOA SECTION 13:

 

Step 1: Notice of Board Meeting

A Notice is required to given 7 days prior Notice is required, if not then shorter consent of majority of directors need to be taken before the meeting.

Documents Required

> Issue of Notice/Shorter Notice Consent of BM

> Agenda

> Notes to agenda

> Resolution

 

Step 2: Hold Board Meeting

Issue notice in accordance with the provisions of section 173(3) of the Companies Act, 2013 and as per SS-1, for convening a meeting of the Board of Directors.

Action to be taken in Board Meeting

> Proposed new Objects

> Pass Board Resolution

> Get members approval through Special Resolution for change in objects

> Decide day, date, time and venue of General Meeting

> Acknowledgement of receipt of Notice

 

Step 3: Notice of General Meeting

Notice of EGM shall be given at least 21 days before the actual date of EOGM. If EOGM is decided to be taken shorter notice, then take the shorter consent of at least 95% before the dispatch of Notice.

 

Step 4: Hold EGM

Action Required:

> Check the proper quorum

> Check whether auditor present

> Pass Special Resolution

> Get approval for alteration of MOA

 

Step 5: File Form MGT-14

Form MGT-14 to be filed within 30 days of passing of Special Resolution.

Attachments

> CTC of Special Resolution along with explanatory statement

> Copy of Notice of meeting send to members

> Copy Altered MOA

> Shorter Notice consent, if any


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