Memorandum of

Association(MOA) & Articles

of Association(AOA)

–By –
Dipankar Dutta
Assistant Prof
Jbit group of institutions, Dehradun
Email- [email protected]
 Important documents used in the formation of a Company
There are basic three documents which are required to be filled with the Registrar
of Companies in the formation of a Public company.

Important documents
used in the formation of
a company

Memorandum of Association
Article of Association(AOA) Prospectus
(MOA)
 Memorandum of Association(MOA)
• It is the principle document of a company. It is considered as a charter of the
company.
• It contains the power and objectives of the particular company.
• It also describes the scope of operations of the company.
• It also state that anything beyond MOA it is unauthorized and illegal.
• According to sec 2(28) of Companies Act MOA is defined as-
“Memorandum of Association as originally framed or as altered from time
to time in pursuance of any previous companies Law or of this Act”
• It can be altered only according to the provision made in the Companies Act
regarding its alteration.
• MOA provides information's to outsiders such as suppliers, creditors etc. to
know the limitation and scope of the companies dealing. It is also known as
the Doctrine of outdoor management.
 Contents of MOA
Memorandum of Association of every company shall contain the following clause
 Name Clause
• The clause contains the complete name of the company. Company can choose
any name subject to the following restrictions-
1) The name of the company must ended with the following words-
“Limited” in case of public limited company.
“Private limited” incase of private limited company.
“[OPC]” incase of one person company.
If the company is a NPO( non profit organization) then only the name is
sufficient.
2) The name should not be similar or identical to the name of any other
company.
3) The name should not contain the word “corporative”.
4) The name should not convey any connection or link of the company with
the Govt. department.
Alteration of Name clause
A company can change its name by passing a special resolution and
by obtaining a written approval from the Central Govt.
But no such approval is required in case of addition or deletion of the
word ‘Private’ consequent on the conversion of a public company into
a private company and vice versa.
 Registered office clause or Situation/ Domicile Clause
• The clause contains the name of the state in which the registered office of
the company is to be situated.
• The registered office is a place where all the documents of the company
are kept.
• A company must have a registered office when it start its business
within 30 days of its operation, whichever is earlier.
Alteration of Situation clause
By passing a special resolution and by obtaining sanctions of the
Registers of both the states if the office is to be shifted from one state to
another.
By passing a special resolution only if the office is to shifted from one
town to another within the state.
By passing a ordinary resolution if office to be shifted from one locality
to another within the same town.
 Object clause
• It is the most important clause of MOA. It contains the main object of
the company and other secondary objects which the company may
peruse in the future.
• The object must be defined and stated keeping in mind the following
conditions-
The object of the company must be legal.
The object should not contrary to the provisions of law.
The object must not be immoral.
Alterations of Object Clause
• In order to alter its object clause, a company must pass a special
resolution and obtain the permission of the Company Law Board.
• Section 13 lays down that- A company, which has raised money from
public through prospectus and has any unutilized amount out of the
money so raised, shall not change its objects for which it raised the
money through prospectus unless a special resolution is passed by the
company.
• After passing resolution company should be filled with ROC the
Registrar shall certify the same within period of 30 days.
 Liability Clause
• This clause defines the liabilities of the company.
• In case of a companies limited by shares, the liability of the members is limited to
the extent of unpaid amount of their share capital.
• For examples- a person is having 100 shares of the face value 10 Rs each. And he
has paid 7 Rs per share then at the time of winding up his liability will be 300 Rs
only.
• In case of company limited by guarantee the liability is limited to the amount of
guarantee given by each member.

Alterations of Liability Clause

If a company wants to make an alteration in Liability clause than it must pass a
unanimous resolution in a meeting of its members.
 Capital Clause
• This clause specified the amount of shares capital which company used
to be registered.
• The capital with which a company registered is called authorized/
registered/ nominal capital. A company can issue by its memorandum.

Alteration of Capital Clause

A company can alter its capital clause by passing a special resolution and
by obtaining the approval of the Company Law Board.
 Association/ Subscription
clause
• This clause contains the declarations by the directors stating that- “We,
the several persons whose name and addresses are submitted, are
desirous to be formed into a company in accordance with
memorandum of association and we undertake to take all the
qualification shares.”
• The name, address, occupation of the subscriber must be given at the
last page of MOA or AOA. Each subscriber must sign in the presence
of at least one witness who shall attest his signature.
• After the registration, no subscriber to the memorandum can withdraw
his subscription on any ground whatsoever.
 Article of Association
• Article of Association contains rules and regulations regarding the
management of company’s internal affairs. It defines the powers,
duties and right of managers, officers and the board of directors.
• Generally all companies prepare their won AOA.
• In case of public companies who do not want to prepare their own
AOA, than they can select any one AOA given in Table F of the
companies Act. In Table F of Companies Act- model set of AOA are
given.
• The AOA must be signed by the all directors of the company.
• It must be duly attested by any two witness.
• Article of Association is also known as bye- laws or Doctrine of
Indoor Management.
Articles generally contains-
Procedure of alterations
• A company may by passing a special resolution, alters its article at any
time. A copy of every special resolution altering the articles shall be filed
with the Registrar within 30 days of its passing.

Limitation of Alterations
Must not be consistent with the Law.
Not illegal or against public policy
Not inconsistent with the order of a Govt. or a court.
Must be for the benefit of the company as a whole.
Must not increase the liability of members.
 ORDINARY RESOLUTION SPECIAL RESOLUTION
An ordinary resolution is passed in the The voter cast vote in favor of resolution,
companies general meeting by a simple whether in person or by proxy are not less
majority of vote than three times the voter cast against the
resolution by members so entitled.

No notice is required to be given for moving A prior notice is needs to be given for
on an ordinary resolution moving a special resolution in any meeting
of the company.
All matters relating to the company's A special resolution is mean to make
business, expect those which needs to be decisions in important matters and protects
settle only by an special resolution are settle the right of company's member.
by an ordinary resolution.
An ordinary resolution doesn't needs to be A copy of every special resolution must be
registered with the registrar. delivered to the Registrar within 30 days of
its passed.