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7 Incorporation of company.

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CHAPTER II

within whose jurisdiction the registered office of a 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 directormanager or secretary of the company, that all the requirements of this Act and the rules made there under 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;

e.     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.

2.     The Registrar on the basis of documents and information filed (form INC-32 for tutorial click here) 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.

7.     Without prejudice to the provisions of sub-section (6), where a 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 Tribunal may, on an application made to it, on being satisfied that the situation so warrants,—

a.     pass such orders, as it may think fit, for regulation of the management of the company including changes, if any, in its memorandum and articles, in public interest or in the interest of the company and its members and creditors; or

b.    direct that liability of the members shall be unlimited; or

c.     direct removal of the name of the company from the register of companies; or

d.    pass an order for the winding up of the company; or

e.     pass such other orders as it may deem fit:

Provided that before making any order under this sub-section,—

      i.        the company shall be given a reasonable opportunity of being heard in the matter; and

     ii.        the Tribunal shall take into consideration the transactions entered into by the company, including the obligations, if any, contracted or payment of any liability.

Short Notes:

  • This section came into force from April 1, 2014. Sub-section (7) [except clause (c) and (d)] came into force from April 1, 2014. 
  • It provides for the procedure to be followed for incorporation of a company.
  • Memorandum and articles of association duly signed, a declaration in prescribed form to the effect that the requirements of the Act in respect of registration have been complied with, affidavit from the subscribers to the memorandum and from the first directors, to the effect, that they are not convicted and have not been found guilty of any fraud or misfeasance, etc. under this Act during the last five years, complete details of name, address of the company, particulars of every subscribers and the persons named as first directors shall be given to the Registrar.
  • Thereafter, Registrar of Companies shall register the company and issue a Certificate of Incorporation and allot a Corporate Identification Number.
  • The persons furnishing false information under this section shall be liable for punishment and the company which is registered shall be liable for punishment prescribed for fraud.
  • Where a company has got incorporated by furnishing any false or incorrect information, the Tribunal may pass order as it may think fit including removal of name from register or winding up of the company.

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Related Discussions.

By : Raj Sehgal On: 28-May-2015
Title: No minimum capital requirement for incorporation of companies
Message:

With Companies amendment Act 2014 the requirement of minimum capital for a company has been done away, now companies can be incorporated with any capital.

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