How to modify 'Object Clause' under CompanIES Act
- ALTERATION OF OBJECT CLAUSE UNDER COMPANIES ACT- 2013
- Section – 13 read in Rule 29 of the Rules of Companies (Incorporation), 2014
- This article contains the procedure for amending the Company Under Companies Act , 2013 Object clause, with detailed documentation required. I hope this paper will be of some practical support to w.r.t. Association Memorandum is the company's charter, and defines the scope of its activities. Association memorandum defines the company 's relationship with the company's members' rights of interest and also establishes the company's relationship with the members.
- A company's Memorandum of Association (MOA) has object clauses which define a company's intent and scope of activities. It might want to change object clause after a company is incorporated. This requires modification of the company's MOA, and the same applies to section 13 of the Companies Act 2013. Every clause on the MOA can be altered by passing a special resolution as mentioned in section 13 (with the exception of the capital clause which requires an ordinary resolution to be passed); We cover the basic method of modifying a company's MOA object clause as per Companies Act 2013.
- Chapter II Incorporation of Business and Matters Incidental Thereto Provisions of the Business Act , 2013: Section 13: Change of Memorandum;
- Company may change its object clause by adding , deleting, changing, substituting or in any other way only if it wishes:
- Measures FOR Modification IN Topic CLAUSE OF ASSOCIATION MEMORANDUM:
- STEP-I- A Board meeting: (Regarding section 173 and SS-1)
- -- Notice of issue of the Board Meeting with all company directors at least 7 days prior to the date of the Board Meeting.
- -- The Agenda attached
- -- Program notes
- -- Proposed resolution-
- STEP: II- Sitting of the Board:
- -- The company's proposed new Artifacts.
- -- Pass Board Resolution after Object Selection.
- -- Get consent to amend the objects provision and propose a plan for consideration by Members by way of a special resolution.
- -- Setting the date, time and place of the General Meeting and approving the sending of the notice to the members of the General Meeting by the Director or by any other person.
- STEP-III: General Meeting Notice issued: (Section 101)
- EGM notice shall be issued at least 21 days before EGM's effective date. With the consent of the atleast majority in number and ninety-five per cent of that part of the paid-up share capital of the company giving the right to vote at such a meeting, EGM may be called on to Shorter Notice:
- -- All Managers.
- -- Deputies
- -- Company auditors
- The notice shall define the meeting place, location, date and time, and shall contain a statement on the business to be transacted at the EGM.
- STEP-IV- General Assembly held: (Section 101)
- -- Review Quorum.
- -- If not, check if auditor is present. Then it is granted or not to leave the absence. (As provided for in Section 146).
- -- Separate resolution passes.[Section-114(2)]
- -- Alteration clearance in MOA.
- STEP-V- Application fees and:
- File FORM NO. MGT-14 (Submission of Resolutions and Agreements to the Registrar pursuant to section 117) with the Registrar, together with the required submission within 30 days of passing the Special Resolution, together with the documents given:-
- DATAKINGS:
- -- Certified authentic copies of the Special Resolutions together with explanatory statement;
- -- Copy of the meeting note, along with all the annexes, sent to members;
- -- A written copy of an Associations Memorandum.
- -- Copy of General Meeting attendance folder.
- -- Shorter Consent Notice, if any.
- STEP-VI-Continue:
- -- The Registrar shall then record the alteration and issue a certificate which will be definitive proof that the company has properly complied with all the conditions relating to the alteration.
- -- The alteration shall be complete and only effective when the certificate is issued by the
- -- Provide an amendment in every copy of the document.
- TRAINS
- SAMPLE BOARD RESOLUTION FOR A change in the Company's Object Clause
- 'RESOLVED THAT pursuant to the provisions of Section 13 and other relevant provisions, if any, of the Companies Act , 2013 (including any substantive amendments or re-enactments thereof, for the time being), and the rules laid down therein, subject to the approval of the Registrar of Companies, and is hereby granted by the Board of Directors of the Company.
- (4) "To carry on the company and manufacture ......................................................"
- FURTHER RESOLVED THAT for the purpose of giving effect to this Resolution, Mr. ABC, Director of the Company shall be allowed, on behalf of the Company, to do all actions, actions, matters and items as deemed required, acceptable or desirable, and to sign and execute all the requisite papers, applications and returns for the purpose of giving effect to the aforementioned Resolution together with the filing of the aforementioned Resolution;
- Example SHAREHOLDERS RESOLUTION FOR A modification in the Company's Topic Clause
- 'RESOLVED THAT pursuant to the provisions of Section 13 and other relevant provisions, if any, of the Companies Act , 2013 (including any substantive amendments or re-enactments thereof, for the time being), and the rules laid down therein pursuant to the consent of the Company's shareholders, subject to the approval of the Companies Registrar, to
- (4) "To carry on the company and manufacture ......................................................"
- FURTHER RESOLVED THAT for the purpose of giving effect to this Resolution, Mr. ABC, Director of the Company shall be allowed, on behalf of the Company, to do all actions, actions, matters and items as deemed required, acceptable or desirable, and to sign and execute all the requisite papers, applications and returns for the purpose of giving effect to the aforementioned Resolution together with the filing of the aforementioned Resolution;