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Procedure to Alter Object Clause of Company

Jasmeen Marwah 
on 10 July 2020

LinkedIn


Whenever a company incorporate, they have to prepare MOA (Memorandum of Association) where they have to mention all the objectives for which they want to be formed.

After incorporation there may come certain situations where the company has to add/delete some objectives, mainly for expansion of business. Thus, there are few steps which need to be followed in case of any change made in Objective Clause of MOA (also refer section 13 of Companies Act, 2013).

We will discuss the procedure to be followed for Alteration in Objective Clause.

Procedure to Alter Object Clause of Company
  1. Firstly, we have to convene a Board meeting to pass the recommendation of change in the object, for this notice is to be sent to all the directors of the company before 7-days from the date of Board Meeting.
  2. In the Notice we have to give explanatory statement about the addition/deletion of the objects, along with this date, time, place of the meeting is to be given (now we can have audio/video conferences to have Board Meeting, therefore need to give details in this regard also).
  3. On the day of Board Meeting, pass the special resolution subject to ROC and members approval. Also fix the date, time and place to convene an Extra-ordinary General Meeting (EGM) to get the approval of the members. 
  4. Notice shall be issued to all the members 21 days before the EGM, but we can also issue shorter notice on consent of all the members. Specify the date, time, place of meeting along with explanatory statement in the notice. EGM can also be convened through audio-video conference, details for the same is to be provided in the notice.
  5. Please amend MOA, add objectives under object clause in case of addition of objects and delete objects in case of deletion.
  6. Conduct the EGM on specify date, get the approval of the members and pass the special resolutions subject to ROC approval. Get the approval of altered MOA also.
  7. Once the special resolution is passed next step is to file MGT-14 to get the approval from ROC. It should be filed within 30-days from the date of passing the Special Resolution.
  8. Attachment required for filing MGT-14: -
  • Copy of Notice of the EGM
  • Copy of Explanatory Statement
  • Copy of Special Resolution passed in EGM
  • Altered MOA (Memorandum of Association)
  1. Fees payable is 600/-
  2. On approval from ROC you will receive a Certificate of Incorporation, it is a conclusive evidence that all the requirements are complied by the company.
  3. Change shall be effective as on the date mentioned in certification of incorporation.

SAMPLE OF BOARD RESOLUTION

"RESOLVED THAT pursuant to the provision of Section 13 and other applicable provisions, if any, of Companies Act, 2013,read with applicable Rules and Regulations made thereunder, including any statutory modification(s) or re-enactment(s) thereof for the time being in force, consent of the Board of Directors be and is hereby accorded,  subject to such approvals, permissions and sanctions of Registrar of Companies, appropriate authorities, departments or bodies as and subject to the approval of Shareholders in General Meeting to add one more business in addition to the existing object clause of the Memorandum of Association(MOA) of the company in following manner:-

 
  • "To carry on the business in India or elsewhere"
  • "To carry on the business of".

RESOLVED FURTHER THAT for the purpose of giving effect to this resolution, the Board of Directors of the Company be and is hereby authorized, on behalf of the company, to do all such acts, deeds, matters and things as it may be necessary and/or expedient for the purpose of giving effect to this resolution."

SAMPLE SPECIAL RESOLUTION -EGM

"RESOLVED THAT pursuant to the provision of Section 13 and other applicable provisions, if any, of Companies Act, 2013,read with applicable Rules and Regulations made thereunder, including any statutory modification(s) or re-enactment(s) thereof for the time being in force, consent of Shareholders of the Company be and is hereby accorded,  subject to such approvals, permissions and sanctions of Registrar of Companies, appropriate authorities, departments or bodies to add more business in addition to the existing object clause of the Memorandum of Association(MOA) of the company in following manner:-

  • "To carry on the business in India or elsewhere"
  • "To carry on the business of"
 

RESOLVED FURTHER THAT for the purpose of giving effect to this resolution, the Board of Directors of the Company be and is hereby authorized, on behalf of the company, to do all such acts, deeds, matters and things as it may be necessary and/or expedient for the purpose of giving effect to this resolution."


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Category Corporate Law
Other Articles by - Jasmeen Marwah 




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