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Change or Alteration of Name under Companies Act 2013

A company being a legal entity should have a name for establishing a separate identity. The name of a company includes a symbol of its independent business existence. The first clause in the memorandum of association of the company includes the name by which a company is recognized. The company may accept any suitable name only if it is not undesirable.

Detail Overview of Name Change of a Company

Change in Name clause of the Company includes modification of Memorandum of Association of the Company. Section 13 of Companies Act 2013 controls the procedure of amendment in Memorandum of Association is pertinent to all companies. All clauses of Memorandum except Capital clause can be changed by following the provisions of Section 13 of Companies Act, 2013 by passing special resolution.

Section 13 of the Companies Act, 2013 manages change of name that states that the name of the company can be changed by a special resolution and with the approval of the Central Government. Approval of Central Government is not needed if the change is associated to the addition/deletion of the words "private" to the name.

Section 4(2), Companies Act, 2013 illustrates that no company shall be registered by name which :

Is identical with or be likely too near to the name of an existing company incorporated under this Act or any previous company law as par Section- 2 (a)

Will include an offence according to any law for the time being in force according to Section- 2 (b) (i)

Is undesirable in the opinion of the Central Government in Section- 2 (b) (Ii)

Sub Section-3 without prejudice (Effect) to the provisions of sub-section (2) [as stated above], a company shall not be incorporated with a name that contains unless the previous approval of the Central Government has been acquired for the use of any such word or expression :

Any word or expression that is expected to give the idea that the company is in any way connected with, or having the support of, the Central Government, any State Government, or any local authority, corporation or body formed by the Central Government or any State Government under any law for the time being in force. Section- 3 (a)]

Such word or expression may be suggested. Section- 3 (b)

For which company alteration of name is not allowed?

The change of name shall not be permitted to a company :

That has not filed annual returns or financial statements due for filing with the Registrar or

That has failed to pay or repay matured deposits or debentures or interest thereon

Steps for alteration in memorandum of association :

Step 1 - Organize Board Meeting of Directors (under section 173 and SS-1)

Issuing notice of Board Meeting to all the directors of company at least 7 days before the date of Board Meeting

Attaching Agenda

Notes to Agenda

Outlining Resolution

Step 2 - Held Board Meeting (Under section 173 and SS-1)

Proposed new names for the company

Pass Board Resolution after Selection of Names

Authorize to Directors of Company to file Application with Registrar of Companies for Name approval

Step 3 - File – e-form- RUN with ROC

File form RUN with Registrar of Companies for approval of name

Attachments

Copy of Board Resolution

Approval of Owner of Trade Mark or the applicant of such application

If proposed name(s) are based on a registered Trade Mark or is a subject matter of an application pending for registration under the Trade Mark Act, 1999

Step 4 - Name Approval Certificate from ROC, if applied name is obtainable

Step 5 - Issuing notice of general meeting under Section 101

Notice of Annual General Meeting shall be offered minimum 21 days before the actual date of AGM. AGM is known on short Notice with the consent of minimum majority in number and ninety five percent of such part of the paid up share capital of the company offering a right to vote at the meeting :

All the Directors

Members

Auditors of Company

The notice shall indicate the place, date, day and time of the meeting and hold a statement on the business to be transacted at the AGM

Step 6 - Hold General Meeting (Section 101)

Check the Quorum

Verify whether auditor is present. If not, then leave of absence is approved or not. (Under Section- 146)

Pass special resolution - Section-114(2)

Approval of change in MOA

Step 7 - Filing of form with ROC -Section 117

File Form MGT-14 (Filing of Resolutions and agreements to the Registrar under section 117) with the Registrar along with the necessary filing within 30 days of passing the special resolution, with given documents.

The name approved valid for 60 days from the date of filing application

Attachments

Certified true copies of the particular resolutions with descriptive statement

Copy of the notice of meeting send to members with all annexure

A printed copy of the Memorandum and Article of Associations

File Form INC – 24 surrounded by 30 days of passing of Special Resolution

Attachments

Notice with descriptive statements

Certified true copy of special resolution

Modifications in MOA & AOA

Minutes of general meeting

Step 8 - Issue of new certificate

After carrying out above process Registrar of Companies will issue a new certificate of incorporation

Whether Stamp Duty is needed to paid for modification in Memorandum of Association (MOA)?

The Act does not reveal new memorandum of association where it claims to be so, it is nothing more than a particular resolution and does not need to be stamped.

Whether it is obligatory that name should reflect the purposes of the Company?

No it is not compulsory to reflect the objects of the Company in its Name. But if any word in name reflecting any business operation that must be companies objects only.

How long name shall be available to use after approval of name?

As per Companies Amendment Act, 2017, name shall be reserved for 60 days from the date of approval of name.

Important points to remember :

A change of name under section 21 does not change the rights and obligations of the company or deliver any defective legal proceedings by or against it, and any legal proceedings, which might have been commenced or continued by or against the company by its past name, may be sustained by or against the company by its new name.

The company which has altered its name would be entitled to ask those companies in which it is holding shares, to substitute its old certificates by new ones.

Frequently Asked Questions

Ques: Which approvals are compulsory for name change of a company?

Consent from the members of the company

Consent from Board

Approval from Central Government

Approval from associated Registrar of Companies

Ques: Is there any restriction while modifying limited company name?

There is no restriction for the name change of a private limited company, which may be the case for a Public company. The names chosen for application must be in compliance with the prescribed rules.

Ques: How to reserve new name for company?

Ministry has launched an online form "RUN" (Reserve Unique Name) for reservation of new name of active companies. The company can apply with 2 different names with its importance. The names should be unique and follow the provisions.

Ques: When the application for change requires to be made?

The application for name change should be made within 30 days of getting the consent of members in General Meeting that is organized after reservation of name. Intimation of resolution is made in form MGT – 14 while the application for the name change is made in form INC – 24.

Ques: Is there any need to change MoA and AoA?

Yes, Memorandum of Association and Article of Association must be change along with the new name. The copy of the alteration is to be filed in INC – 24.

Ques: Whether modification of object can be processed at once?

If the name change is made because of change in the main entity, both the processes can be executed at once. As the approval of the Government is concerned, the period can vary depending on the response and time taken by Registrar of Companies.

Ques: When will the new name of company be of use?

It will be effective only after acquiring a new Certificate of Incorporation. The associated officer will issue a fresh certificate with a new name if he becomes satisfied with the application.

Ques: When should the application to change PAN be filed?

Company's new name can be updated in PAN or any other registration after getting new Certificate of Incorporation.

Ques: What will be the consequence to change company name?

Once change of name is completed, the company must update its name with all the ministries it is registered with. All the stationeries such as letterheads, Business cards, display board and others must be updated with a new name. A vital change is approval of contracts entered in the earlier name. The parties to contract must approve said contracts after accepting a new name.

Ques: Is there any need to show the old name with the new name of the organization?

Yes, for a period of two years from change, wherever the company's name is shown, the previous name must be displayed also.



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