The Step by Step Process to Make Changes to Your Indian Company
If you are a business person, you should be aware that you can make changes to your Indian company by following certain legal procedures of the Ministry of Corporate Affairs. Commonly, companies make changes in the company’s trading name, business address, or the trading activity carried out. For instance, if a firm is growing very fast, hires more people, and buys a bigger office, the official address can be changed.
The Procedure for Changing the Trading Name of a company
All companies should have a unique trading name at the country level, and if a business wants to change its name, it has to follow some mandatory procedures.
- Passing a board resolution during a board meeting where the directors will approve the new name.
- The next step is verifying the availability of the trading name. The authorized director should supervise this process by filing specific forms.
- Filing the form INC-1 with the Ministry of Corporate Affairs (MCA) in India.
- The ROC (Registrar of Companies) will confirm the name’s availability.
- After the institutions approve the new name, the firm’s representatives will pass a special resolution, and the company’s statutory documents will be modified.
- The representatives will sign the resolution and file it with the RoC within 30 days of passing it.
- The RoC issues the new Certificate of Incorporation needed for changing the company name.
Procedure to Change the Business Activity of a Company
The Memorandum of Association (MOA) is the principal document to make changes in a company’s business activity. A private limited company can only perform the activities mentioned in the MOA. For any changes in trading activity, the company has to change the MOA.
Follow these steps for changing the trading activity:
- The shareholders have to approve the change in business activity, and the company has to pass a special resolution in the following cases:
- a) If the firm wishes to expand its business
- b) If the firm takes over another company with a different trading activity
- c) If the firm desires to start a different business
- d) If the government bans the present trading business activity for some reason
- The Board of Directors (BOD) may fix a date and time for an Extraordinary General Meeting (EGM) to get the shareholders’ approval.
- The BOD will authorize any director to file essential forms with the MCA. All shareholders must receive the meetings’ notice 21 days before the meeting.
- The shareholders have to pass a special resolution to modify the MOA’s object clause. For non-private limited companies or firms that issue capital through the prospectus, business activity can be changed using postal ballot by passing a special resolution.
- The company must file form MGT-14 within 30 days after the special resolution passed in the EGM. The company also needs the MCA’s approval.
The documents required with the form
- a) The board resolution’s true copy
- b) The EGM notice
- c) The special resolution’s true copy
- d) The altered MOA
After the MCA’s approval, the company needs to alter all copies of the MOA. It can then resume new business activities.
The Process for Changing the Business Address of a Company
Every business requires a registered office, which is its official address. The Companies Act 2013 allows companies to change their official address from one state to another. There also are other rules related to this matter laid out by the Company Incorporation Rules 2014.
The process to change the business address from one state to another:
- Make drafts of Memorandum and Articles of Association of the company.
- Convene a board meeting, and prepare a notice for Extraordinary General Meeting (EGM
- Hold an EGM and pass a special resolution for a change in the MOA. At least 75% of the people with voting rights in the company need to approve the resolution.
- The resolution’s certified copy must be filed in form MGT-14 to the ROC within 30 day
- Form INC-23 to be applied to seek approval for changes in MOA related to the address change, along with essential documents. It must be sent to the chief secretary and registrar of the state where the registered office is located
- An advertisement mentioning the address change is to be placed in two newspapers 30 days before the hearing in English and the state’s main language.
- The notice of the application is to be sent to all creditors and debenture holders, chief secretary, registrar, or any other relevant authority governing the company.
- A copy of any objection raised by an affected person is to be sent to the regional director or federal government.
- If there is no objection, the regional director confirms the change by making an order.
- After the order is passed, approving the address change, file form INC-22 with both ROCs, along with necessary documents. Then file form-28 to the ROC to complete the process.
For Addressing Change Within the Same City
In this case, the companies can relocate without the shareholder’s or any other authority’s permission. But, they must notify the change to the registrar through form INC-22.
For Addressing Change Between Two Cities Within the Same State
In this case, approval of shareholders is a must by passing special resolutions. Changes in MOA or other permissions are not necessary.
As a businessperson, you can make changes to your Indian company as required while running your business. But, it is advisable to follow all mandatory processes to avoid legal issues. The team of 3E Accounting provides professional secretarial services, and we are familiar with all the procedures for making specific changes to companies. Our Company Secretary Services are the best in India, and we are eager to help companies with all the essential documentation and legal formalities.
3E Accounting India
3E Accounting India is a corporate service provider and accounting firm assisting clients with company formation and incorporation. We offer company secretary and business-related services in India.
