This article has been written by Mr. Aman Mishra, a 5th year student studying BALLB, from at IMS Unison University, Dehradun.
Introduction: –
Chapter II Section. 3 of the Companies Act, 2013 deals with incorporation of company or formation of company in detail. The promoters who wish to form the company get prepared various documents which are required to be filed with the Registrar of the Companies of the State in which the registered office of the company is situated to obtain the registration of the company. The certificate of incorporation brings the company into existence as a legal person.
ACT TO OVERRIDE MEMORANDUM, Articles, Section 6
Save as otherwise expressly provided in this Act-
(a) the provision of this act shall have effect notwithstanding anything of the country contained in the memorandum of article of a company, or in agreement executed by it, or in any resolution passed by the company in general meeting or by its Board of Directors, whether same be registered, executed or passed, as the case may be, before or after the commences of the act.
(b) any provision contained in the memorandum, articles, agreement, or resolution shall, to m extent to which it is repugnant to the provisions of this Act, become void, as the case may be
INCORPORATION Of COMPANY – Section. 7
There shall be filed with the Registrar within whose jurisdiction the registered office of company is proposed to be situated, the following documents and information for registration namely-
(a) the memorandum and articles of the company duly signed by all the subscribers to the memorandum in such manner as may be prescribed.
(b) a declaration in the prescribed form by an advocate, a chartered accountant, cost accountant or company secretary in practice, who is engaged in the formation of the company, and by a person named in the articles as a director, manager or secretary of the company, that all the requirements of this Act and the rules made thereunder in respect of registration and matters precedent or incidental thereto have been complied with.
(c) an affidavit from each of the subscribers to the memorandum and from persons named as the first directors, if any, in the articles that he is not convicted of any offence in connection with the promotion, formation or management of any company, or that he has not been found guilty of any fraud or misfeasance or of any breach of duty to any company under this Act or any previous company law during the preceding five years and that all the documents filed with the Registrar for registration of the company contain information that is correct and complete and true to the best of his knowledge and belief;
(d) the address for correspondence till its registered office is established.
€ the particulars of name, including surname or family name, residential address, nationality, and such other particulars of every subscriber to the memorandum along with proof of identity, as may be prescribed, and in the case of a subscriber being a body corporate, such particulars as may be prescribed.
(f) the particulars of the persons mentioned in the articles as the first directors of the company, their names, including surnames or family names, the Director Identification Number, residential address, nationality, and such other particulars including proof of identity as may be prescribed; and
(g) the particulars of the interests of the persons mentioned in the articles as the first directors of the company in other firms or bodies corporate along with their consent to act as directors of the company in such form and manner as may be prescribed.
(h) The Registrar based on documents and information filed under sub-section (1) shall register all the documents and information referred to in that subsection in the register and issue a certificate of incorporation in the prescribed form to the effect that the proposed company is incorporated under this Act.
(3) On and from the date mentioned in the certificate of incorporation issued under sub-section (2), the Registrar shall allot to the company a corporate identity number, which shall be a distinct identity for the company, and which shall also be included in the certificate.
(4) The company shall maintain and preserve at its registered office copies of all documents and information as originally filed under sub-section (1) till its dissolution under this Act.
(5) If any person furnishes any false or incorrect particulars of any information or suppresses any material information, of which he is aware in any of the documents filed with the Registrar in relation to the registration of a company, he shall be liable for action under section 447.
(6) Without prejudice to the provisions of sub-section (5) where, at any time after the incorporation of a company, it is proved that the company has been got incorporated by furnishing any false or incorrect information or representation or by suppressing any material fact or information in any of the documents or declaration filed or made for incorporating such company, or by any fraudulent action, the promoters, the persons named as the first directors of the company and the persons making declaration under clause (b) of subsection (1) shall each be liable for action under section 447.
EFFECT OF REGISTRATION -Section .9
From the date of incorporation mentioned in the certificate of incorporation, such subscribers to the memorandum and all other persons, as may, from time to time, become members of the company, shall be a body corporate by the name contained in the memorandum, capable of exercising all the functions of an incorporated company under this Act and having perpetual succession and a common seal with power to acquire, hold and dispose of property, both movable and immovable, tangible and intangible, to contract and to sue and be sued, by the said name.
- Effect of Memorandum and Articles – S. 10
- Subject to the provisions of this Act, the memorandum and articles shall, when registered, bind the company and the members thereof to the same extent as if they respectively had been signed by the company and by each member, and contained covenants on its and his part to observe all the provisions of the memorandum and of the articles.
(2) All monies payable by any member to the company under the memorandum or articles shall be a debt due from him to the company.
(b) Commencement of business, etc. – S. 11
(1) A company having a share capital shall not commence any business or exercise any borrowing powers unless-
- a declaration is filed by a director in such form and verified in such manner as may be prescribed, with the Registrar that every subscriber to the memorandum has paid the value of the shares agreed to be taken by him and the paid-up share capital of the company is not less than five lakh rupees in case of a public company and not less than one lakh rupees in case of a private company on the date of making of this declaration; and
- the company has filed with the Registrar a verification of its registered office as provided in sub-section (2) of section 12.
- If any default is made in complying with the requirements of this section, the company shall be liable to a penalty which may extend to five thousand rupees and every officer who is in default shall be punishable with fine which may extend to one thousand rupees for every day during which the default continues.
- Where no declaration has been filed with the Registrar under clause (a) of subsection (1) within a period of one hundred and eighty days of the date of incorporation of the company and the Registrar has reasonable cause to believe that the company is not carrying on any business or operations, he may, without prejudice to the provisions of sub-section (2), initiate action for the removal of the name of the company from the register of companies under Chapter XVII.
CONCLUSION-
Every company limited by shares or company limited by guarantee or unlimited company shall submit memorandum an article of association of association for incorporation of company to be filed with the Registrar within whose jurisdiction the registered office of a company is proposed to be situated duly signed by all the subscribers with their declaration and an affidavit from each subscriber to the memorandum and from persons named as first directors, if any, in the article. The Registrar on the basis of documents and information filed thereunder after making entry in the register, issue a certificate of incorporation in the prescribe form to the effect that the proposed company is incorporated under this Act.