A company is an object of law. It is an artificial legal person capable of performing activities analogous to the natural person acting through its board of directors. The famous case law of Solomon v Solomon and company Ltd established the fact that a company is a separate legal entity. The name of the company is the name with which it is registered with the Registrar of Companies and which also appears on the certificate of incorporation. Most of us are aware of the fact that the name of a company can be changed before its incorporation. But, one of the most critical questions of all time is that can the company name change after its incorporation?
The answer is YES. But before moving to the next question as to how it can be done, let us first look at some of the conditions that govern the selection of a company name change. Subsection 2, section 4 of the companies act, 2013 provides that the name of the company should be unique i.e. should not be identical to or should not bear too close a resemblance with the name of any other company so as to create confusion in the minds of the general public. It should not be undesirable as well. A company cannot be registered with a name unless it has been approved by the central government. Also, the name with which a company is registered should not indicate that the company in any way is connected or is receiving funds or patronage from a union or state government under any law. However, even after following these norms, there may arise a need to company name change after its incorporation.
- Conversion of name from public to private
- Conversion of private to public
- Company name change from Setindiabiz Private Limited to KPS Corporate Consultants Private Limited
The Name Clause forms a part of the Memorandum of Association, so company name change requires alteration of the Memorandum of Association. Section 13 of Companies Act allows all changes in the Memorandum of Association except the capital clause.
Name of the company can be changed by passing a special resolution and with the approval of the Central government. But if addition/deletion of the word private is there, no approval of the central government is required.
Steps Involved In Change Of Company Name After Incorporation
- The first and the foremost step in the change of name is a meeting of the board of directors. The notice of the meeting of a board of directors should be given at least seven days before the meeting. A notice should be also accompanied by an attachment mentioning the agenda of the meeting.
- The next step is to file an e form INC -1 with the Registrar of Companies for approval of name. Attachments, in this case, are a copy of Board of Directors resolution and the approval of the owner of the trademark or if any.
- The Registrar of Companies shall issue a new certificate of incorporation if the applied names are available.
- The board meeting has to be called by giving seven days notice and also agenda has to be sent. In the meeting, name availability certificate has to be placed before the board and date and time of Extraordinary General Meeting has to be fixed. The draft of the Extraordinary General Meeting has to be placed and the director needs to be authorized to issue a notice of Extraordinary General Meeting. The notice of the extraordinary general meeting can be given either through electronic mode or in writing to all the Directors of Company, all the Members of Company and auditors of Company.
- The Extraordinary General Meeting has to be held with the required Quorum.
- The auditor has to be present and resolution for the approval of Alteration in MOA & AOA is passed.
Several e forms have to file with the Registrar of Companies namely-
- E-form MGT-14 within 30 days of passing of Special Resolution with attachments of notice along with Explanatory Statements, Certified true Copy of Special Resolution, Altered in MOA & AOA and Minutes of General Meeting h attachments
- E-form INC-24 within 30 days of passing of Special Resolution
After completing Above, Procedure ROC will issue a New Certificate of Incorporation in form No. – 25. (Rule-29 of THE Companies (Incorporation) Rules, 2014). The name will be effective from the date of issue of Certificate.
Thus the procedure of company name change requires alteration of the name clause. It is an important procedure because many companies may seek to change their names after incorporation as well.