{"id":104490,"date":"2021-10-09T16:11:09","date_gmt":"2021-10-09T10:41:09","guid":{"rendered":"https:\/\/legalwindow.in\/?p=104490"},"modified":"2021-10-09T17:16:04","modified_gmt":"2021-10-09T11:46:04","slug":"allotment-of-new-name-to-existing-company-under-companies-act-2013","status":"publish","type":"post","link":"https:\/\/www.legalwindow.in\/blog\/allotment-of-new-name-to-existing-company-under-companies-act-2013\/","title":{"rendered":"Allotment of New Name to Existing Company under Companies Act, 2013"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-104497 size-full\" src=\"https:\/\/legalwindow.in\/wp-content\/uploads\/Allotment-of-New-Name-to-Existing-Company-under-Companies-Act-2013.png\" alt=\"Allotment of New Name to Existing Company under Companies Act, 2013\" width=\"1200\" height=\"630\" srcset=\"https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Allotment-of-New-Name-to-Existing-Company-under-Companies-Act-2013.png 1200w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Allotment-of-New-Name-to-Existing-Company-under-Companies-Act-2013-600x315.png 600w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Allotment-of-New-Name-to-Existing-Company-under-Companies-Act-2013-300x158.png 300w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Allotment-of-New-Name-to-Existing-Company-under-Companies-Act-2013-1024x538.png 1024w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/Allotment-of-New-Name-to-Existing-Company-under-Companies-Act-2013-768x403.png 768w\" sizes=\"auto, (max-width: 1200px) 100vw, 1200px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">The name of the company is an identity it is recognised with. The Companies Act, 2013 allows the companies to change their name in certain circumstances. But what if the name of the company is changed compulsorily by government itself. Yes, this is our topic of discussion today that what will happen in case of Allotment of New Name to Existing Company under <a href=\"https:\/\/legalwindow.in\/buy-back-of-shares-under-companies-act-2013\/\" target=\"_blank\" rel=\"noopener\">Companies Act, 2013<\/a>.<\/span><\/p>\n<table style=\"width: 100%;\">\n<tbody>\n<tr>\n<td style=\"border: 1px solid #555;\">\n<p style=\"text-align: justify;\"><strong>Table of Contents<\/strong><\/p>\n<ul>\n<li style=\"text-align: justify;\"><a href=\"#legal\">Legal Provisions for Name of a Company<\/a><\/li>\n<li style=\"text-align: justify;\"><a href=\"#rectification\">Rectification in the name of the company<\/a><\/li>\n<li style=\"text-align: justify;\"><a href=\"#allotment\">Allotment of New Name to an Existing Company<\/a><\/li>\n<li style=\"text-align: justify;\"><a href=\"#effect\">Effect of the amendment by Central Government<\/a><\/li>\n<li style=\"text-align: justify;\"><a href=\"#company\">Aftermath of allotment of a new name to an existing company<\/a><\/li>\n<li style=\"text-align: justify;\"><a href=\"#conclusion\">Conclusion<\/a><\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2 id=\"legal\"><b>Legal Provisions for Name of a Company<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The name of the company is mentioned under Name Clause of Memorandum of Association of the Company. The name of a private company should contain the word \u201cPrivate Limited\u201d and those of<a href=\"https:\/\/legalwindow.in\/public-limited-company\/\" target=\"_blank\" rel=\"noopener\"> Public Limited Company<\/a> should contain words \u201cLimited\u201d. The name of company should not be similar to any other company and should not contain anything that is prohibited in law.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The company should send the application for Name to the <a href=\"https:\/\/legalwindow.in\/roc-company-anuual-filing\/\" target=\"_blank\" rel=\"noopener\">ROC<\/a> with applicable fees. ROC will reserve the name and meanwhile verify the application. And if the application is found correct then the <a href=\"https:\/\/legalwindow.in\/roc-llp-annual-filing\/\" target=\"_blank\" rel=\"noopener\">ROC<\/a> will allot name and mentionit in the Certificate of Incorporation.<\/span><\/p>\n<h2 id=\"rectification\"><b>Rectification in the name of the company<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">In following cases the company will be asked to change its name-<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Where Central Government feels that the name of the company resembles or is identical to an existing company. In this case company has to change its name within 3 months of the order. The company should pass an ordinary resolution for the change.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In case of a complaint from a registered trademark proprietor that a company is having a name similar to its name or resembles its name. The Central Government may direct the company to change its name. The company has to change the name within 3 months of the order. The company should pass an ordinary resolution for the change.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The company should inform ROC after change in the name of the company within 15 days. ROC will make necessary changes in the certificate of incorporation and memorandum.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">The new amendment enters the picture from here. If the company fails to follow this order than Central Government will allot a new name to the company. Now, let us discuss amendment notification dated 22.07.2021.<\/span><\/p>\n<h2 id=\"allotment\"><b>Allotment of New Name to an Existing Company<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The above discussed provisions were amended as per Companies Act<a href=\"https:\/\/legalwindow.in\/amendment-bill-2021\/\" target=\"_blank\" rel=\"noopener\"> Amendment Rule<\/a>s,2020. Now, to implement above provisions, MCA released two notifications on 22.07.2021.<\/span><\/p>\n<p><b>First Notification-\u00a0<\/b><\/p>\n<p><span style=\"font-weight: 400;\">If the company is asked to change its name as per above provisions and the company fails to do so within a period of three months then the name of the company will be changed-<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The new name of the company will contain\u00a0<\/span><\/p>\n<ul>\n<li aria-level=\"1\"><span style=\"font-weight: 400;\">Letters \u201cORDNC\u201d (Order of Regional Director Not Complied\u201d<\/span><\/li>\n<li aria-level=\"1\"><span style=\"font-weight: 400;\">The Year of Passing the direction<\/span><\/li>\n<li aria-level=\"1\"><span style=\"font-weight: 400;\">The Serial number and existing Corporate Identity Number (CIN) of the company.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Registrar will update company\u2019s name in Register of Companies. Also ROC will issue a fresh certificate of incorporation in Form INC-11C. The Registrar will also issue a signed certificate by the authorised officer. The certificate will state that the name is changed under whose jurisdiction and authority.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It may be noted that in case company has submitted a name change application (INC-24) before end of three months and it is pending for disposal then these provisions will not be applicable.<\/span><\/p>\n<p><b>Second Notification<\/b><\/p>\n<p><span style=\"font-weight: 400;\">This notification stated that 1<\/span><span style=\"font-weight: 400;\">st<\/span><span style=\"font-weight: 400;\"> September, 2021 will be the date to implement the new provisions. These provisions regarding allotment of new name to an existing company were introduced by Companies Act Amendment Rules, 2020.<\/span><\/p>\n<h2 id=\"effect\"><b>Effect of the amendment by Central Government<\/b><\/h2>\n<ul>\n<li><span style=\"font-weight: 400;\">As per the amendment notification, a company should change its name everywhere it is printed. This means on all the printed boards, letter heads etc., the name of the company will be changed. This implies that company has to write \u201cOrder of Regional Director not complied (under <a href=\"https:\/\/www.mca.gov.in\/Ministry\/pdf\/CompaniesAct2013.pdf\" target=\"_blank\" rel=\"noopener\">Section 16 of the Companies Act, 2013<\/a>)\u201d along with its name at all places.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The effective date is 01.09.2021 and notification date is 22.07.2021. This means that Registrar has given almost one month to the companies to comply with issued orders.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The companies those who have not changed the name and whose order completes 3 months on 01.09.2021. The<a href=\"https:\/\/legalwindow.in\/step-by-step-process-for-the-name-change-of-company-as-per-companies-act-2013\/\" target=\"_blank\" rel=\"noopener\"> name change process<\/a> for such companies will be initiated.<\/span><\/li>\n<\/ul>\n<h2 id=\"company\"><b>Aftermath of allotment of a new name to an existing company<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">AS per earlier provisions a company that fails to comply with order of changing name was supposed to pay prescribed fine. For large companies, paying fine was not that a big deal.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The compliance was delayed as changing name is a big task for any company. The name change has various implications. It has to be changed on all the places where it is displayed. Stakeholders have to be made aware of the name. All the letter heads, bill books etc. have to be printed fresh. The name should be updated with all other legal authorities.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This type of punishment is worst then paying fees. As in this case an identity of the company will be at stake. All stakeholders will get to know that company has failed to follow the order. This may further tarnish image of the company.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">However, there is relief as in case company subsequently changes its name by alteration of memorandum and following prescribed procedures. Then the company need not show the statement.<\/span><\/p>\n<p><a href=\"https:\/\/legalwindow.in\/change-of-name-of-company-llp\/\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-104500 size-full\" src=\"https:\/\/legalwindow.in\/wp-content\/uploads\/imgpsh_fullsize_anim.jpg\" alt=\"change name of company in India\" width=\"1000\" height=\"200\" srcset=\"https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/imgpsh_fullsize_anim.jpg 1000w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/imgpsh_fullsize_anim-600x120.jpg 600w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/imgpsh_fullsize_anim-300x60.jpg 300w, https:\/\/www.legalwindow.in\/blog\/wp-content\/uploads\/imgpsh_fullsize_anim-768x154.jpg 768w\" sizes=\"auto, (max-width: 1000px) 100vw, 1000px\" \/><\/a><\/p>\n<h2 id=\"conclusion\"><b>Conclusion<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">From the above discussion we can conclude that allotment of new name to existing company is a very bold move by central government. It is a way to say that nobody can take the orders of the authority lightly. The consequence of not following the order of Central Government is made very severe. At the same time all the companies who have been issued such orders. They are given almost one month to act upon those orders.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The name of the company is an identity it is recognised with. The Companies Act, 2013 allows the companies to change their name in certain circumstances. But what&hellip;<\/p>\n","protected":false},"author":9,"featured_media":104498,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-104490","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-company-law"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Allotment of New Name to Existing Company under Companies Act, 2013<\/title>\n<meta name=\"description\" content=\"Complete Guide about Allotment of New Name to Existing Company under Companies Act, 2013, Allotment, Rectification, Legal Provisions for Name of a Company.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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