India: How to change the name of a company

 

Section 13(2) of the Companies Act, 2013 pertains to the process of changing the name of the company. This requires passing a special resolution in the general meeting and obtaining approval from the Central Government. Learn about the legal process and the steps that must be taken to change the name of a company in India through this article.

Section 13(2) along with Section 4(2) and 4(3) of the Companies Act, 2013, and Rule 8, Rule 29(1) and (2) of the Companies (Incorporation) Rules, 2014 deals with the alteration of the company name.

Under the Companies Act, 2013 the company can pass the Special resolution and subject to the approval of Registrar of Companies can change the name of the Company.

Legal Provisions for Changing a Company's Name

Section 13(2) of the Companies Act, 2013 deals with the name change of the company by passing the special resolution in the general meeting and with the approval of the Central Government.

Section 4(2) of the Companies Act 2013 prohibits a company from having a name that is identical to or closely resembles an existing company's name, violates any existing law, or is considered undesirable by the Central Government.

Section 4(3) of the Companies Act 2013 adds that certain words or expressions in a company's name require prior approval from the Central Government to avoid creating a false impression of government affiliation.

Restrictions on Name Changes (Rules 29(1) and 29(2) of Companies (Incorporation) Rules, 2014):

Rule 29(1): Companies that have defaulted in filing documents with the Registrar or in repaying deposits or debentures cannot change their names.

Rule 29(2): An application in Form INC-24 must be filed along with the fee to change the name. Upon approval, a new certificate of incorporation in Form INC-25 is issued with the updated name.

The Company after incorporation can change their name the in the following way:

• Conversion of Company from Public to Private
• Conversion of Company from Private to Public
• Change of name from ABC Limited to XYZ Limited
• Voluntary Name Change
• Change to New Business Activities
• Change in Ownership
• For Marketing Purposes

 

Following Points must be considered while Filing the Application

• The proposed selected names should be different and unique and should not be identical to the already existing company names or registered trademarks.
• All proposed names must be submitted for prior approval to the Registrar of Companies in the prescribed form, including those which suggest a connection with the government or government patronage, for example ‘national’, ‘union’, ‘central’, ‘federal’, ‘republic’, ‘president’, ‘rashtrapati’, ‘small scale industries’, ‘cottage industries’ etc. Words such as ‘International’, ‘Corporation’, ‘Globe’, ‘Universal’, ‘Hindustan’, ‘India’, ‘Bharat’, ‘Continental’, ‘Inter-Continental’, ‘Industries’, ‘Udyog’, ‘Enterprises’, ‘Products’, ‘Business’, ‘Manufacturing’, ‘Asiatic’ and ‘Asia’ are allowed only if the scope and scale of business of the proposed company justifies the use of such words.
• Apply for maximum two names as per your choice

 

Process to Change the Name of a Company

1. Call the Board Meeting: A meeting of the Board of Directors shall be called to consider the reason for changing the name of the company and get its approval for the change in name of the Company. Also, a Board resolution authorizing the Company Secretary/ Director to make the required application to the Registrar of Companies shall be passed in the meeting.

2. Make the application in the E-Form RUN: Application can make in the E Form RUN for the reservation of Name. The Application filed with office of CRC, Registrar of Companies, Ministry of Corporate Affairs. The application fees for filing the RUN Form is Rs. 1000/-. Once the name is approved, the name is reserved for 60 days from the date of approval.

3. Calling the Extra Ordinary General Meeting: Once the name is approved by the CRC, Registrar of Companies, Ministry of Corporate Affairs, the company call the Extra Ordinary General Meeting and pass the resolution for the alteration of Name clause in the Memorandum of Association and also alter the Article of Association where the name of the company is coming.

4. Filing of Requisite Forms:

(a) E Form MGT-14: A special resolution is a decision that requires the approval of at least 75 per cent of the voting rights of the shareholders that are present at the EGM. Once the special resolution to change the company’s name is passed at the EGM, the company must make sure to file it with the Registrar of Companies (ROC) for approval. The company must use Form MGT-14 and pay the prescribed fee in order to file the special resolution. Within 30 days of passing the resolution at the EGM, the company must file the form with the ROC along with the following attachments:

1. Certified True Copies of the Special Resolutions along with explanatory statement
2. Copy of the Notice of meeting send to members along with all the annexure
3. Altered Memorandum & Article of Association.
4. Copy of Attendance Sheet of General Meeting
5. Shorter Notice Consent, if any.

(b) E-Form INC-24 (Application for change of name to seek approval of Central Government) needs to be filed to give effect to change in name with the following attachments:

• Notice along with Explanatory Statements.
• Certified True Copy of Special Resolution.
• Altered Memorandum & Article of Association.
• Minutes of General Meeting.

5. Issuance of Fresh Certificate of Incorporation: The ROC issues a fresh Certificate of Incorporation with the changed name once the approval of INC-24 and MGT-14 is received. The company should be aware that it cannot use its new name until it receives the fresh Certificate of Incorporation from the ROC. Until then, the company should continue to use its previous name for all business and legal purposes.

Steps to be taken after name change

• A company needs to get its name changed in every pending case before District/High Court or any other authority.
• A company needs to get the name changed in the government records like PF, ESI, GST, PAN or any other applicable statutes.
• The company needs to replace its stationery like Letter Head, Bills, Invoices, Office Board, appointment letters.
• Company needs to print old name and new name for a continuous period of 2 years in stationery like Letter Head, Bills, Invoices, Office Board, appointment letters.
• If a company is holding any shares of the listed company, then it also needs to report the name change to the depository and the company.
• A company also needs to get the name changed in bank records, financial institutions and other applicable bodies.

 

ROC Fee

• RUN Form: Rs. 1000 for the application to reserve new name of the company.
• INC-24: Rs. 1,000 to Rs 20,000 based on company’s type and capital.
• MGT-14: Rs. 300 to Rs 600 based on the capital of the company.

 

For further information, please contact:

Gautam Khurana, Managing Partner

India Law Offices, New Delhi

e: g.khurana@indialawoffices.com

t: +91 11 24622216

 

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