A company's fundamental legal obligations and organisational structure are described in the Memorandum of Association (MOA of Private Limited Company).
The Memorandum of Association (MOA of a Private Limited Company) outlines a company’s fundamental legal provisions and its organizational structure. It is a fundamental legal document that guarantees the company’s very existence. A Memorandum of Association is a legal document that every Company must have. For the benefit of the general public’s knowledge, the MOA serves as the company charter and specifies and restricts the rights of a company. In order to provide shareholders, creditors, and other parties with guidance, the Memorandum of Association lists the permitted scope of Business activities. A suitable Memorandum of Association must be created when forming your company in order to protect you and your enterprise in the long run.
Memorandum of Association’s provisions (MOA of Private Limited Company)
- Name Clause: In the case of private companies, the last two letters of the company name must be “Private Limited Registration,” while in the case of public companies, the last word must be “Limited.” A company cannot be registered under a name that is offensive, according to the Companies Act. Only the facts and details of each case will allow for a determination of whether a name is desirable or not.
- Situation Clause: The state in which the company’s registered office will be located must be mentioned in the memorandum of association. In order for the Court: https://main.sci.gov.in/ and the Registrar to determine their respective jurisdictions, the domicile of the corporation must be specified. There should be a registered office within a specific domicile, and notice of it needs to be given either during the time of the registration or within 30 days of that date, providing the company does not start doing business before this 30-day window.
- Object Clause: This object clause may specify and list any number of permissible objectives, whether or not the company actually performs all of those activities. This clause is given the highest priority from a legal standpoint. Any action that violates the objects clause but is not stated explicitly in the association memorandum would be regarded as ultra vires, or outside the scope of the company’s authority.
- Clause Limiting Liability: A company governed by shares or by assurance must specify that the liability of its representatives is restricted. Members are the group most impacted by this clause. A member must give written consent before the company can increase their liability.
- Capital Clause: The MOA of a company with a share capital must define the amount of shareholding with which the company will be registered, as well as how the capital is divided into shares with a fixed value.
Association and Subscription Clause: At the bottom of the Memorandum, there should always be an association clause that expresses the subscribers’ desire to organise themselves into a body corporate. According to the subscription clause, each subscriber must purchase at least one share of the company and must sign the subscription agreement along with a statement of the number of shares purchased.
Articles of Association (AOA of Private Limited Company)
A business document, such as a company’s Articles of Association (AOA), must be interpreted strictly because it is one. It establishes definite obligations and rights between both the representatives and the company and controls how a company is managed domestically. In actuality, the company’s bylaws, or articles of association, set forth how directors as well as other officers are expected to carry out their duties with regard towards the company’s management, its own finances, and its audit. Every private limited, unlimited, or limited liability company must register both their articles and their memorandum of association.
Companies have the ability to amend or add to their articles thanks to Section 31. A company is unable to relinquish these authority. The article can be changed to address issues that the memorandum leaves unaddressed. A special resolution must be used to make the change.
Conclusion
You should consult and seek advice from our knowledgeable team of legal experts at Vakilsearch if you want to comprehend the requirements of the MOA of Private Limited Company correctly.
