AMENDMENT OF AOA: ABOUT: The Article of Association is a document of internal rules and regulations or in other words bylaws of the company. It defines the roles and responsibilities of the board of directors and other employees of the company. The alteration in the article of association requires changes in its clause due to applicable laws and sometimes due to agreements or contractual agreements.
The Articles of Association mainly consists of the following –
• First Directors of Company.
• Share Capital and Variation of Rights.
• Transfer and Transmission of shares.
• Annual General Meeting, Extraordinary General Meeting, and Board Meeting, voting rights of the members in such meetings, and provisions about veto power.
• Details of First Subscribers.
• Dividends and Reserve policies.
• Details regarding Chief Executive Officer, Manager, Company Secretary, or Chief Financial Officer.
• The closure of the company along with the conditions under which it can be dissolved is also discussed.
• The Members of the Board are bound by a confidentiality clause as stated in the AoA, which means that no member can disclose the functioning of the company to an outsider. Any amendment made in the Articles of Association can only be made in the above-mentioned clauses by informing the concerned Registrar of Companies about the change being made. Section 14 of the Companies Act, 2013 contains the provisions for the alteration of the Articles of Association of a company. A company may modify, delete or add any article in the following manner:
Process of Changing the Articles of Association –
• A notice needs to be issued for conducting a Board Meeting at least 7 days prior to the meeting.
• A special resolution is passed at the Board Meeting with the consent of the members for making changes in the Articles of Association.
• Date, time and place should be fixed for holding a General Meeting and a Director needs to send the notice to all the members informing them about the same.
• The quorum needs to be checked at the General Meeting, which will mean getting the approval of the members to change the clauses in the Articles of Association which will be stated in the special resolution thereon.
• Form MGT-14 is filed with the RoC along with a certified true copy of the special resolution, explanatory statement, copy of the notice of the meeting sent to members, and a copy of the altered Articles of Association within 30 days of passing the special resolution
• The Registrar of Companies will accordingly register the changes made in the AoA and issue a certificate that will be conclusive of the amendments made. The alteration will be complete and effective only when the RoC issues the certificate.
• After the certificate has been issued by the RoC, the company will need to make changes in every copy of the Articles of Association. Alteration in Article of Association (AOA) is nothing more than a special resolution and as such does not require to be stamped. A mistake, whether clerical or any other, in the articles of a company, can only be rectified by altering the articles by special resolution in accordance with this section. It cannot be set right by application to Court.
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Assistance in amending the AOA of the company. Amend AOA of company, Service Fees: 5999/- excluding government Fees.
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FREQUENTLY ASKED QUESTIONS (FAQ):
Q. What can be changed in the Articles of Association?
The Articles of Association consists of the rules and regulations of the company, which should be complied with by every member, director, and employee of the organization. Therefore, any clause in the AoA can be amended, provided it is done within the provisions stated in the Companies Act, 2013.
Q. Can the MoA and AoA be altered in the same meeting?
Yes, it is possible to call one meeting to alter both the Memorandum of Association and Articles of Association of a company.
Q. Can AOA be amended retrospectively?
The alteration cannot have a retrospective effect. It can operate only from the date of the amendment.
Q. Does AOA a public document?
The articles are a public document open to inspection at the registered office. They create a contract between the company and each of its members in their capacity as members.