The Companies Act, 2013

(1) This Act may be called the Companies Act, 2013. (2) It extends to the whole of India. (3) This section shall come into force at once and the remaining provisions of this Act shall come into force on such date1 as the Central Government may, by notification in the Official Gazette, appoint and *different dates may be appointed for different provisions of this Act and any reference in any provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision. (4) The provisions of this Act shall apply to-- (a) companies incorporated under this Act or under any previous company law; (b) insurance companies, except in so far as the said provisions are inconsistent with theprovisions of the Insurance Act, 1938 (4 of 1938) or the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999); (c) banking companies, except in so far as the said provisions are inconsistent with the provisions of the Banking Regulation Act, 1949 (10 of 1949); (d) companies engaged in the generation or supply of electricity, except in so far as the saidprovisions are inconsistent with the provisions of the Electricity Act, 2003 (36 of 2003); (e) any other company governed by any special Act for the time being in force, except in so far as the said provisions are inconsistent with the provisions of such special Act; and (f) such body corporate, incorporated by any Act for the time being in force, as the Central Government may, by notification, specify in this behalf, subject to such exceptions, modifications or adaptation, as may be specified in the notification.To be deleted

In this Act, unless the context otherwise requires,-- (1) "abridged prospectus" means a memorandum containing such salient features of a prospectus asmay be specified by the Securities and Exchange Board by making regulations in this behalf; (2) "accounting standards" means the standards of accounting or any addendum thereto forcompanies or class of companies referred to in section 133; (3) "alter" or "alteration" includes the making of additions, omissions and substitutions; (4) "Appellate Tribunal" means the National Company Law Appellate Tribunal constituted undersection 410; (5) "articles" means the articles of association of a company as originally framed or as altered fromtime to time or applied in pursuance of any previous company law or of this Act; (6) "associate company", in relation to another company, means a company in which that othercompany has a significant influence, but which is not a subsidiary company of the company havingsuch influence and includes a joint venture company. 1[Explanation.-- For the purpose of this clause,-- (a) the expression "significant influence" means control of at least twenty per cent. of totalvoting power, or control of or participation in business decisions under an agreement; (b) the expression "joint venture" means a joint arrangement whereby the parties that have jointcontrol of the arrangement have rights to the net assets of the arrangement;] (7) "auditing standards" means the standards of auditing or any addendum thereto for companies orclass of companies referred to in sub-section (10) of section 143; (8) "authorised capital" or "nominal capital" means such capital as is authorised by thememorandum of a company to be the maximum amount of share capital of the company; (9) "banking company" means a banking company as defined in clause (c) of section 5 of theBanking Regulation Act, 1949 (10 of 1949); (10) "Board of Directors" or "Board", in relation to a company, means the collective body of thedirectors of the company; (11) "body corporate" or "corporation" includes a company incorporated outside India, but doesnot include-- (i) a co-operative society registered under any law relating to co-operative societies; and (ii) any other body corporate (not being a company as defined in this Act), which the CentralGovernment may, by notification, specify in this behalf; (12) "book and paper" and "book or paper" include books of account, deeds, vouchers, writings,documents, minutes and registers maintained on paper or in electronic form; (13) "books of account" includes records maintained in respect of-- (i) all sums of money received and expended by a company and matters in relation to which thereceipts and expenditure take place; (ii) all sales and purchases of goods and services by the company; (iii) the assets and liabilities of the company; and (iv) the items of cost as may be prescribed under section 148 in the case of a company whichbelongs to any class of companies specified under that section; (14) "branch office", in relation to a company, means any establishment described as such by thecompany; (15) "called-up capital" means such part of the capital, which has been called for payment; (16) "charge" means an interest or lien created on the property or assets of a company or any of itsundertakings or both as security and includes a mortgage; (17) "chartered accountant" means a chartered accountant as defined in clause (b) of sub-section(1) of section 2 of the Chartered Accountants Act, 1949 (38 of 1949) who holds a valid certificate ofpractice under sub-section (1) of section 6 of that Act; (18) "Chief Executive Officer" means an officer of a company, who has been designated as such byit; (19) "Chief Financial Officer" means a person appointed as the Chief Financial Officer of acompany; (20) "company" means a company incorporated under this Act or under any previous companylaw; (21) "company limited by guarantee" means a company having the liability of its members limitedby the memorandum to such amount as the members may respectively undertake to contribute to theassets of the company in the event of its being wound up; (22) "company limited by shares" means a company having the liability of its members limited bythe memorandum to the amount, if any, unpaid on the shares respectively held by them; 2[(23) "Company Liquidator" means a person appointed by the Tribunal as the CompanyLiquidator in accordance with the provisions of section 275 for the winding up of a company underthis Act;] (24) "company secretary" or "secretary" means a company secretary as defined in clause (c) ofsub-section (1) of section 2 of the Company Secretaries Act, 1980 (56 of 1980) who is appointed by acompany to perform the functions of a company secretary under this Act; (25) "company secretary in practice" means a company secretary who is deemed to be in practiceunder sub-section (2) of section 2 of the Company Secretaries Act, 1980 (56 of 1980); (26) "contributory" means a person liable to contribute towards the assets of the company in theevent of its being wound up. Explanation.--For the purposes of this clause, it is hereby clarified that a person holding fullypaid-up shares in a company shall be considered as a contributory but shall have no liabilities of acontributory under the Act whilst retaining rights of such a contributory; (27) "control" shall include the right to appoint majority of the directors or to control themanagement or policy decisions exercisable by a person or persons acting individually or in concert, directly or indirectly, including by virtue of their shareholding or management rights or shareholdersagreements or voting agreements or in any other manner; 3[(28) "Cost Accountant" means a cost accountant as defined in clause (b) of sub-section (1) ofsection 2 of the Cost and Works Accountants Act, 1959 (23 of 1959) and who holds a valid certificate ofpractice under sub-section (1) of section 6 of that Act;] (29) "court" means-- (i) the High Court having jurisdiction in relation to the place at which the registered office of thecompany concerned is situate, except to the extent to which jurisdiction has been conferred on anydistrict court or district courts subordinate to that High Court under sub-clause (ii); (ii) the district court, in cases where the Central Government has, by notification, empowered anydistrict court to exercise all or any of the jurisdictions conferred upon the High Court, within thescope of its jurisdiction in respect of a company whose registered office is situate in the district; (iii) the Court of Session having jurisdiction to try any offence under this Act or under anyprevious company law; (iv) the Special Court established under section 435; (v) any Metropolitan Magistrate or a Judicial Magistrate of the First Class having jurisdiction totry any offence under this Act or under any previous company law; (30) "debenture" includes debenture stock, bonds or any other instrument of a company evidencing adebt, whether constituting a charge on the assets of the company or not: 4[Provided that-- (a) the instruments referred to in Chapter III-D of the Reserve Bank of India Act, 1934 (2 of 1934);and (b) such other instrument, as may be prescribed by the Central Government in consultation withthe Reserve Bank of India, issued by a company, shall not be treated as debenture;] (31) "deposit" includes any receipt of money by way of deposit or loan or in any other form by acompany, but does not include such categories of amount as may be prescribed in consultation withthe Reserve Bank of India; (32) "depository" means a depository as defined in clause (e) of sub-section (1) of section 2 of theDepositories Act, 1996 (22 of 1996); (33) "derivative" means the derivative as defined in clause (ac) of section 2 of the SecuritiesContracts (Regulation) Act, 1956 (42 of 1956); (34) "director" means a director appointed to the Board of a company; (35) "dividend" includes any interim dividend; (36) "document" includes summons, notice, requisition, order, declaration, form and register,whether issued, sent or kept in pursuance of this Act or under any other law for the time being in forceor otherwise, maintained on paper or in electronic form; (37) "employees stock option" means the option given to the directors, officers or employees of acompany or of its holding company or subsidiary company or companies, if any, which gives suchdirectors, officers or employees, the benefit or right to purchase, or to subscribe for, the shares of thecompany at a future date at a pre-determined price; (38) "expert" includes an engineer, a valuer, a chartered accountant, a company secretary, a costaccountant and any other person who has the power or authority to issue a certificate in pursuance ofany law for the time being in force; (39) "financial institution" includes a scheduled bank, and any other financial institution defined ornotified under the Reserve Bank of India Act, 1934 (2 of 1934); (40) "financial statement" in relation to a company, includes-- (i) a balance sheet as at the end of the financial year; (ii) a profit and loss account, or in the case of a company carrying on any activity not for profit,an income and expenditure account for the financial year; (iii) cash flow statement for the financial year; (iv) a statement of changes in equity, if applicable; and (v) any explanatory note annexed to, or forming part of, any document referred to in sub-clause(i) to sub-clause (iv): Provided that the financial statement, with respect to One Person Company, small company anddormant company, may not include the cash flow statement; (41) "financial year", in relation to any company or body corporate, means the period ending on the31st day of March every year, and where it has been incorporated on or after the 1st day of January ofa year, the period ending on the 31st day of March of the following year, in respect whereof financialstatement of the company or body corporate is made up: 5[Provided that where a company or body corporate, which is a holding company or a subsidiaryor associate company of a company incorporated outside India and is required to follow a differentfinancial year for consolidation of its accounts outside India, the Central Government may, on anapplication made by that company or body corporate in such form and manner as may be prescribed,allow any period as its financial year, whether or not that period is a year: Provided further that any application pending before the Tribunal as on the date ofcommencement of the Companies (Amendment) Act, 2019, shall be disposed of by the Tribunal inaccordance with the provisions applicable to it before such commencement;] 6[Provided also that] a company or body corporate, existing on the commencement of this Act,shall, within a period of two years from such commencement, align its financial year as per theprovisions of this clause; (42) "foreign company" means any company or body corporate incorporated outside India which-- (a) has a place of business in India whether by itself or through an agent, physically or throughelectronic mode; and (b) conducts any business activity in India in any other manner; (43) "free reserves" means such reserves which, as per the latest audited balance sheet of acompany, are available for distribution as dividend: Provided that-- (i) any amount representing unrealised gains, notional gains or revaluation of assets, whethershown as a reserve or otherwise, or (ii) any change in carrying amount of an asset or of a liability recognised in equity, includingsurplus in profit and loss account on measurement of the asset or the liability at fair value, shall not be treated as free reserves; (44) "Global Depository Receipt" means any instrument in the form of a depository receipt, bywhatever name called, created by a foreign depository outside India and authorised by a companymaking an issue of such depository receipts; (45) "Government company" means any company in which not less than fifty-one per cent. of thepaid-up share capital is held by the Central Government, or by any State Government or Governments,or partly by the Central Government and partly by one or more State Governments, and includes acompany which is a subsidiary company of such a Government company; (46) "holding company", in relation to one or more other companies, means a company of whichsuch companies are subsidiary companies; 7[Explanation.-- For the purposes of this clause, the expression "company" includes any body corporate;] (47) "independent director" means an independent director referred to in sub-section (6) of section149; (48) "Indian Depository Receipt" means any instrument in the form of a depository receipt createdby a domestic depository in India and authorised by a company incorporated outside India making anissue of such depository receipts; 8* * * * * (50) "issued capital" means such capital as the company issues from time to time for subscription; (51) "key managerial personnel", in relation to a company, means-- (i) the Chief Executive Officer or the managing director or the manager; (ii) the company secretary; (iii) the whole-time director; (iv) the Chief Financial Officer; 9*** 10[(v) such other officer, not more than one level below the directors who is in whole-time employment,designated as key managerial personnel by the Board; and (vi) such other officer as may be prescribed;] (52) "listed company" means a company which has any of its securities listed on any recognisedstock exchange; 11[Provided that such class of companies, which have listed or intend to list such class of securities,as may be prescribed in consultation with the Securities and Exchange Board, shall not be considered aslisted companies.] (53) "manager" means an individual who, subject to the superintendence, control and direction ofthe Board of Directors, has the management of the whole, or substantially the whole, of the affairs of acompany, and includes a director or any other person occupying the position of a manager, bywhatever name called, whether under a contract of service or not; (54) "managing director" means a director who, by virtue of the articles of a company or anagreement with the company or a resolution passed in its general meeting, or by its Board of Directors,is entrusted with substantial powers of management of the affairs of the company and includes adirector occupying the position of managing director, by whatever name called. Explanation.--For the purposes of this clause, the power to do administrative acts of a routinenature when so authorised by the Board such as the power to affix the common seal of the company toany document or to draw and endorse any cheque on the account of the company in any bank or todraw and endorse any negotiable instrument or to sign any certificate of share or to direct registration of transfer of any share, shall not be deemed to be included within the substantial powers ofmanagement; (55) "member", in relation to a company, means-- (i) the subscriber to the memorandum of the company who shall be deemed to have agreed tobecome member of the company, and on its registration, shall be entered as member in its registerof members; (ii) every other person who agrees in writing to become a member of the company and whosename is entered in the register of members of the company; (iii) every person holding shares of the company and whose name is entered as a beneficialowner in the records of a depository; (56) "memorandum" means the memorandum of association of a company as originally framed oras altered from time to time in pursuance of any previous company law or of this Act; (57) "net worth" means the aggregate value of the paid-up share capital and all reserves created outof the profits 12[, securities premium account and debit or credit balance of profit and loss account,] after deducting the aggregate value of the accumulated losses, deferred expenditure and miscellaneousexpenditure not written off, as per the audited balance sheet, but does not include reserves created outof revaluation of assets, write-back of depreciation and amalgamation; (58) "notification" means a notification published in the Official Gazette and the expression"notify" shall be construed accordingly; (59) "officer" includes any director, manager or key managerial personnel or any person inaccordance with whose directions or instructions the Board of Directors or any one or more of thedirectors is or are accustomed to act; (60) "officer who is in default", for the purpose of any provision in this Act which enacts that anofficer of the company who is in default shall be liable to any penalty or punishment by way ofimprisonment, fine or otherwise, means any of the following officers of a company, namely:-- (i) whole-time director; (ii) key managerial personnel; (iii) where there is no key managerial personnel, such director or directors as specified by theBoard in this behalf and who has or have given his or their consent in writing to the Board to suchspecification, or all the directors, if no director is so specified; (iv) any person who, under the immediate authority of the Board or any key managerialpersonnel, is charged with any responsibility including maintenance, filing or distribution ofaccounts or records, authorises, actively participates in, knowingly permits, or knowingly fails totake active steps to prevent, any default; (v) any person in accordance with whose advice, directions or instructions the Board ofDirectors of the company is accustomed to act, other than a person who gives advice to the Boardin a professional capacity; (vi) every director, in respect of a contravention of any of the provisions of this Act, who isaware of such contravention by virtue of the receipt by him of any proceedings of the Board orparticipation in such proceedings without objecting to the same, or where such contravention hadtaken place with his consent or connivance; (vii) in respect of the issue or transfer of any shares of a company, the share transfer agents,registrars and merchant bankers to the issue or transfer; (61) "Official Liquidator" means an Official Liquidator appointed under sub-section (1) ofsection 59; (62) "One Person Company" means a company which has only one person as a member; (63) "ordinary or special resolution" means an ordinary resolution, or as the case may be, specialresolution referred to in section 114; (64) "paid-up share capital" or "share capital paid-up" means such aggregate amount of moneycredited as paid-up as is equivalent to the amount received as paid-up in respect of shares issued andalso includes any amount credited as paid-up in respect of shares of the company, but does not includeany other amount received in respect of such shares, by whatever name called; (65) "postal ballot" means voting by post or through any electronic mode; (66) "prescribed" means prescribed by rules made under this Act; (67)"previous company law" means any of the laws specified below:-- (i) Acts relating to companies in force before the Indian Companies Act, 1866 (10 of 1866); (ii) the Indian Companies Act, 1866 (10 of 1866); (iii) the Indian Companies Act, 1882 (6 of 1882); (iv) the Indian Companies Act, 1913 (7 of 1913); (v) the Registration of Transferred Companies Ordinance, 1942 (Ord. 54 of 1942); (vi) the Companies Act, 1956 (1 of 1956); and (vii) any law corresponding to any of the aforesaid Acts or the Ordinances and in force-- (A) in the merged territories or in a Part B State (other than the State of Jammu andKashmir*), or any part thereof, before the extension thereto of the Indian Companies Act,1913 (7 of 1913); or (B) in the State of Jammu and Kashmir*, or any part thereof, before the commencement ofthe Jammu and Kashmir (Extension of Laws) Act, 1956 (62 of 1956), in so far as banking,insurance and financial corporations are concerned, and before the commencement of theCentral Laws (Extension to Jammu and Kashmir) Act, 1968 (25 of 1968), in so far as othercorporations are concerned; (viii) the Portuguese Commercial Code, in so far as it relates to sociedades anonimas; and (ix) the Registration of Companies (Sikkim) Act, 1961 (Sikkim Act 8 of 1961); (68) "private company" means a company having a minimum paid-up share capital 13*** as may beprescribed, and which by its articles,-- (i) restricts the right to transfer its shares; (ii) except in case of One Person Company, limits the number of its members to two hundred: Provided that where two or more persons hold one or more shares in a company jointly, they shall,for the purposes of this clause, be treated as a single member: Provided further that-- (A) persons who are in the employment of the company; and (B) persons who, having been formerly in the employment of the company, were members ofthe company while in that employment and have continued to be members after the employmentceased, shall not be included in the number of members; and (iii) prohibits any invitation to the public to subscribe for any securities of the company; (69) "promoter" means a person-- (a) who has been named as such in a prospectus or is identified by the company in the annualreturn referred to in section 92; or (b) who has control over the affairs of the company, directly or in directly whether as a shareholder, director or otherwise; or (c) in accordance with whose advice, directions or instructions the Board of Directors of thecompany is accustomed to act: Provided that nothing in sub-clause (c) shall apply to a person who is acting merely in aprofessional capacity; (70) "prospectus" means any document described or issued as a prospectus and includes a redherring prospectus referred to in section 32 or shelf prospectus referred to in section 31 or any notice,circular, advertisement or other document inviting offers from the public for the subscription orpurchase of any securities of a body corporate; (71)"public company" means a company which-- (a) is not a private company; 14[and] (b) has a minimum paid-up share capital 15*** as may be prescribed: Provided that a company which is a subsidiary of a company, not being a private company, shall bedeemed to be public company for the purposes of this Act even where such subsidiary companycontinues to be a private company in its articles ; (72) "public financial institution" means-- (i) the Life Insurance Corporation of India, established under section 3 of the Life InsuranceCorporation Act, 1956 (31 of 1956); (ii) the Infrastructure Development Finance Company Limited, referred to in clause (vi) ofsub-section (1) of section 4A of the Companies Act, 1956 (1 of 1956) so repealed under section465 of this Act; (iii) specified company referred to in the Unit Trust of India (Transfer of Undertaking andRepeal) Act, 2002 (58 of 2002); (iv) institutions notified by the Central Government under sub-section (2) of section 4A of theCompanies Act, 1956 (1 of 1956) so repealed under section 465 of this Act; (v) such other institution as may be notified by the Central Government in consultation with theReserve Bank of India: Provided that no institution shall be so notified unless-- (A) it has been established or constituted by or under any Central or State Act 16[other than thisAct or the previous company law]; or (B) not less than fifty-one per cent. of the paid-up share capital is held or controlled by theCentral Government or by any State Government or Governments or partly by the CentralGovernment and partly by one or more State Governments; (73) "recognised stock exchange" means a recognised stock exchange as defined in clause (f) ofsection 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956); (74) "register of companies" means the register of companies maintained by the Registrar on paperor in any electronic mode under this Act; (75) "Registrar" means a Registrar, an Additional Registrar, a Joint Registrar, a Deputy Registrar oran Assistant Registrar, having the duty of registering companies and discharging various functionsunder this Act; (76) "related party", with reference to a company, means-- (i) a director or his relative; (ii) a key managerial personnel or his relative; (iii) a firm, in which a director, manager or his relative is a partner; (iv) a private company in which a director or manager 16[or his relative] is a member or director; (v) a public company in which a director or manager is a director 17[and holds] along with hisrelatives, more than two per cent. of its paid-up share capital; (vi) any body corporate whose Board of Directors, managing director or manager is accustomedto act in accordance with the advice, directions or instructions of a director or manager; (vii) any person on whose advice, directions or instructions a director or manager is accustomedto act: Provided that nothing in sub-clauses (vi) and (vii) shall apply to the advice, directions orinstructions given in a professional capacity; 18[(viii) any body corporate which is-- (A) a holding, subsidiary or an associate company of such company; (B) a subsidiary of a holding company to which it is also a subsidiary; or (C) an investing company or the venturer of the company. Explanation.-- For the purpose of this clause, "the investing company or the venturer of acompany" means a body corporate whose investment in the company would result in the companybecoming an associate company of the body corporate]; (ix) such other person as may be prescribed; (77) "relative", with reference to any person, means any one who is related to another, if-- (i) they are members of a Hindu Undivided Family; (ii) they are husband and wife; or (iii) one person is related to the other in such manner as may be prescribed; (78) "remuneration" means any money or its equivalent given or passed to any person for servicesrendered by him and includes perquisites as defined under the Income-tax Act, 1961 (43 of 1961); (79) "Schedule" means a Schedule annexed to this Act; (80) "scheduled bank" means the scheduled bank as defined in clause (e) of section 2 of theReserve Bank of India Act, 1934 (2 of 1934); (81) "securities" means the securities as defined in clause (h) of section 2 of the SecuritiesContracts (Regulation) Act, 1956 (42 of 1956); (82) "Securities and Exchange Board" means the Securities and Exchange Board of Indiaestablished under section 3 of the Securities and Exchange Board of India Act, 1992 (15 of 1992); (83) "Serious Fraud Investigation Office" means the office referred to in section 211; (84) "share" means a share in the share capital of a company and includes stock; (85) "small company" means a company, other than a public company,-- (i) paid-up share capital of which does not exceed fifty lakh rupees or such higher amount asmay be prescribed which shall not be more than 19[ten crore rupees]; 20[and] (ii) turnover of which 21[as per profit and loss account for the immediately preceding financialyear] does not exceed two crore rupees or such higher amount as may be prescribed which shall notbe more than 25[one hundred crore rupees]: Provided that nothing in this clause shall apply to-- (A) a holding company or a subsidiary company; (B) a company registered under section 8; or (C) a company or body corporate governed by any special Act; (86) "subscribed capital" means such part of the capital which is for the time being subscribed bythe members of a company; (87) "subsidiary company" or "subsidiary", in relation to any other company (that is to say theholding company), means a company in which the holding company-- (i) controls the composition of the Board of Directors; or (ii) exercises or controls more than one-half of the 23[total voting power] either at its own ortogether with one or more of its subsidiary companies: Provided that such class or classes of holding companies as may be prescribed shall not have layersof subsidiaries beyond such numbers as may be prescribed. Explanation.--For the purposes of this clause,-- (a) a company shall be deemed to be a subsidiary company of the holding company even if thecontrol referred to in sub-clause (i) or sub-clause (ii) is of another subsidiary company of theholding company; (b) the composition of a company's Board of Directors shall be deemed to be controlled byanother company if that other company by exercise of some power exercisable by it at its discretioncan appoint or remove all or a majority of the directors; (c) the expression company includes any body corporate; (d) "layer" in relation to a holding company means its subsidiary or subsidiaries; (88) "sweat equity shares" means such equity shares as are issued by a company to its directors oremployees at a discount or for consideration, other than cash, for providing their know-how or makingavailable rights in the nature of intellectual property rights or value additions, by whatever name called; (89) "total voting power", in relation to any matter, means the total number of votes which may becast in regard to that matter on a poll at a meeting of a company if all the members thereof or theirproxies having a right to vote on that matter are present at the meeting and cast their votes; (90) "Tribunal" means the National Company Law Tribunal constituted under section 408;24[(91) turnover means gross amount of revenue recognised in the profit and loss account from the sale,supply, or distribution of goods or on account of services rendered, or both, by a company during a financialyear;] (92) "unlimited company" means a company not having any limit on the liability of its members; (93) "voting right" means the right of a member of a company to vote in any meeting of thecompany or by means of postal ballot; (94) "whole-time director" includes a director in the whole-time employment of the company; 25[(94A) "winding up" means winding up under this Act or liquidation under the Insolvency andBankruptcy Code, 2016 (31 of 2016), as applicable;] (95) words and expressions used and not defined in this Act but defined in the Securities Contracts(Regulation) Act, 1956 (42 of 1956) or the Securities and Exchange Board of India Act, 1992(15 of 1992) or the Depositories Act, 1996 (22 of 1996) shall have the meanings respectively assignedto them in those Acts.

(1) A company may be formed for any lawful purpose by-- (a) seven or more persons, where the company to be formed is to be a public company; (b) two or more persons, where the company to be formed is to be a private company; or (c) one person, where the company to be formed is to be One Person Company that is to say, a private company, by subscribing their names or his name to a memorandum and complying with the requirements of this Act in respect of registration: Provided that the memorandum of One Person Company shall indicate the name of the other person,with his prior written consent in the prescribed form, who shall, in the event of the subscribers death or his incapacity to contract become the member of the company and the written consent of such person shall also be filed with the Registrar at the time of incorporation of the One Person Company along with its memorandum and articles: Provided further that such other person may withdraw his consent in such manner as may be prescribed: Provided also that the member of One Person Company may at any time change the name of such other person by giving notice in such manner as may be prescribed:Provided also that it shall be the duty of the member of One Person Company to intimate thecompany the change, if any, in the name of the other person nominated by him by indicating in the memorandum or otherwise within such time and in such manner as may be prescribed, and the company shall intimate the Registrar any such change within such time and in such manner as may be prescribed:Provided also that any such change in the name of the person shall not be deemed to be an alteration of the memorandum. (2) A company formed under sub-section (1) may be either-- (a) a company limited by shares; or (b) a company limited by guarantee; or (c) an unlimited company.

1[3A. Members severally liable in certain cases.-- If at any time the number of members of a companyis reduced, in the case of a public company, below seven, in the case of a private company, below two,and the company carries on business for more than six months while the number of members is soreduced, every person who is a member of the company during the time that it so carries on business afterthose six months and is cognisant of the fact that it is carrying on business with less than seven membersor two members, as the case may be, shall be severally liable for the payment of the whole debts of thecompany contracted during that time, and may be severally sued therefor.]

(1) The memorandum of a company shall state-- (a) the name of the company with the last word "Limited" in the case of a public limitedcompany, or the last words "Private Limited" in the case of a private limited company: Provided that nothing in this clause shall apply to a company registered under section 8; (b) the State in which the registered office of the company is to be situated; (c) the objects for which the company is proposed to be incorporated and any matter considered necessary in furtherance thereof; (d) the liability of members of the company, whether limited or unlimited, and also state,-- (i) in the case of a company limited by shares, that liability of its members is limited to theamount unpaid, if any, on the shares held by them; and (ii) in the case of a company limited by guarantee, the amount up to which each memberundertakes to contribute -- (A) to the assets of the company in the event of its being wound-up while he is a memberor within one year after he ceases to be a member, for payment of the debts and liabilities ofthe company or of such debts and liabilities as may have been contracted before he ceases to be a member, as the case may be; and (B) to the costs, charges and expenses of winding-up and for adjustment of the rights ofthe contributories among themselves; (e) in the case of a company having a share capital,-- (i) the amount of share capital with which the company is to be registered and the divisionthereof into shares of a fixed amount and the number of shares which the subscribers to thememorandum agree to subscribe which shall not be less than one share; and (ii) the number of shares each subscriber to the memorandum intends to take, indicatedopposite his name; (f) in the case of One Person Company, the name of the person who, in the event of death of thesubscriber, shall become the member of the company. (2) The name stated in the memorandum shall not-- (a) be identical with or resemble too nearly to the name of an existing company registered under this Act or any previous company law; or (b) be such that its use by the company-- (i) will constitute an offence under any law for the time being in force; or (ii) is undesirable in the opinion of the Central Government. (3) Without prejudice to the provisions of sub-section (2), a company shall not be registered with a name which contains-- (a) any word or expression which is likely to give the impression that the company is in any way connected with, or having the patronage of, the Central Government, any State Government, or any local authority, corporation or body constituted by the Central Government or any State Government under any law for the time being in force; or (b) such word or expression, as may be prescribed, unless the previous approval of the Central Government has been obtained for the use of any such word orexpression. (4) A person may make an application, in such form and manner and accompanied by such fee, as may be prescribed, to the Registrar for the reservation of a name set out in the application as-- (a) the name of the proposed company; or (b) the name to which the company proposes to change its name. (5) 1[(i) Upon receipt of an application under sub-section (4), the Registrar may, on the basis of information anddocuments furnished along with the application, reserve the name for a period of twenty days from the date ofapproval or such other period as may be prescribed: Provided that in case of an application for reservation of name or for change of its name by an existingcompany, the Registrar may reserve the name for a period of sixty days from the date of approval.] (ii) Where after reservation of name under clause (i), it is found that name was applied by furnishing wrong or incorrect information, then,-- (a) if the company has not been incorporated, the reserved name shall be cancelled and the person making application under sub-section (4) shall be liable to a penalty which may extend to one lakh rupees; (b) if the company has been incorporated, the Registrar may, after giving the company anopportunity of being heard-- (i) either direct the company to change its name within a period of three months, after passingan ordinary resolution; (ii) take action for striking off the name of the company from the register of companies; or (iii) make a petition for winding up of the company. (6) The memorandum of a company shall be in respective forms specified in Tables A, B, C, D and E in Schedule I as may be applicable to such company. (7) Any provision in the memorandum or articles, in the case of a company limited by guarantee and not having a share capital, purporting to give any person a right to participate in the divisible profits of thecompany otherwise than as a member, shall be void.