A private limited company may later modify the name it chose when it was incorporated. A special resolution from the shareholders as well as MCA permission is needed for a private limited company to alter its name. A private limited company's legal status or continued existence as a corporate entity is unaffected by a name change. A company's name change does not result in forming a new business or legal entity. A company is governed under The Companies Act, 2013 and the rules made there. Changing the company name will require following the rules and procedures in the act.
Did You Know? The Companies Act 2013 provides a long list of undesirable names that a company can’t use in its name or use as its name.
Steps involved to Change Company Name in India.
There are a lot of legal procedures involved in changing the name of the company. Here is the step-by-step process. It is worth noting that it is not a lock-step process but can be altered depending on the circumstances of the individual case. Also, the Name of a company is governed by the Name Clause of the Memorandum of Association (MOA). So, changing the name of the company requires altering the MOA of the company. Here are the steps involved in changing the name of a company in India
Step 1: Undesirable Names that cannot be used in the name of a company
The first and foremost step is to identify a name that you propose to change that should not violate the provision of The Companies Act, 2013. The Companies Act 2013 provides a long list of names considered undesirable in the Central government's opinion which cannot be used in the name of the company at its incorporation and even after incorporation. As per the provision contained in The Companies Act, A Company shall not be incorporated or purpose to change with a name that contains -
- A word or expression which is supposed to give an idea that the Company is in any way associated with, or has the support of, the Central Government or any State government or Any local authority, corporation, or body set up by an act of parliament.
- A name of a company in English or any other language giving the same meaning unless the prior approval of the Central Government has been obtained for the use of any such word or expression as follows -
- Small Scale Industries.
- Village and Khadi Industries.
- Development Authority.
- Forest corporation.
- Development Scheme.
- Statute or Statutory.
- Court or Judiciary.
If the proposed name includes words such as insurance, bank, stock exchange, Venture Capital, Asset Management, Nidhi, Mutual fund, etc., unless the applicant submits a declaration that the requirements mandated by the prescribed regulator, such as the Insurance Regulatory Development Authority of India (IRDA), Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), etc have been complied with by the applicant.
Step 2: Pass a Board Resolution
Whether a private or a public Company, the Board of Directors is required to pass a board resolution in a board meeting to change the name of the company and propose a new name of the company.
Step 3: Pass a Special Resolution
Where votes in favor of the resolution are two third of the votes against the resolution, it is called a special resolution. To get the mandate of the shareholders or members of the company to change the name, A special resolution is required to pass at the meeting of the members where at least 75 % of the members present at the meeting should give consent to the proposed change.
To get the approval of Central Government, the company should file from MGT-14 and INC 24 in 30 days from the date of EGM. The company whose name is proposed to be changed is required to obtain the prior approval of the central government. If the central government is satisfied with the proposed name, the company's name could be changed following the above procedures. However, if the central government rejects the application, the company cannot change its name and will have to use its existing name.
However, no such approval from the central government is required on account of the company's conversion from one class to another or the addition or deletion of “private” from its name.
Step 4: Check the name Availability and reserve it.
A person on behalf of the company can check the proposed name as available and such name is not reserved for other company or a company is not already registered with the proposed name, Check domain for the proposed name, Check trademark for the proposed name. Once, you identify the name of the company.
Then, Make an application under RUN (Reserve Unique Name) for the proposed name.
Upon receipt of the application in the prescribed form, the registrar of companies may on the basis of the information specified in the application may reserve the name of the company for a period of 60 days from the date of approving the application.
Step 5: Make an Application to Central Goverment
With the proposed name, make an application to the central goverment in Form 1B to change the name of the company. It is required for a Public Company to make an application to the central goverment when the a Public Company propose to change the name.
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Rectification of Name of Company
As per sec. 16 of the Companies Act, 2013. If a company on its first registration or on its registration by a new name is registered by a name that -
- In the opinion of the central government, it is identical to or resembles the name of a company already registered under this act or under any other previous company laws, It may direct the company to change its name, and the company shall be required to change its name within a period of 3 months from the date of making such an order.
- On an application made by a registered owner of a trademark that the name of the company is identical to or resembles the trademark already registered to the central government within 3 years of incorporation of the company, the central government will make a note of it and direct the company to change its name within 3 months from the date of making such order.
Where a company changes its name under the order of the central government, the company is required to give notice of the change within a period of 15 days from the date of change with The Registrar Of Companies (ROC) and shall obtain a fresh Certificate of Incorporation and also make necessary changes in the memorandum of Association (MOA).
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Changing the company name is not an easy task but with the right help, it is quite easy. Over time the government has also acknowledged it and thus, you are only required to make an easy online application to the registrar of companies and if required with competent authority like the central government. It is also worth noting that with the advancement in technology, filling such forms for changing names is quite easy. On the MCA website, there is help desk support where a lot of free content is available to guide you along the way of changing the company name. Hope you enjoyed and liked the article reading it. We have discussed various procedures in the easiest ways.
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