Name, company incorporation rules (2014)

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Name, Company incorporation rules (2014)

Definitions

In these rules, unless otherwise the context requires,-

a, “Act” means the Companies Act, 2013 (18 of 2013);

b, “Annexure” means to these rules annexure;

c, “Form” or “e-form” means a form in the electronic form or non-electronic form as indicated under the rules or Act there-under made and notified by the Central Government under the Act;

d, “Fees” means as indicated in the Companies (Registration offices and Fees ) Rules, 2014;

e, “Regional Director ” means the appointed person by the Central Government in the Ministry of Corporate Affairs as a Regional Director.

2, Words and expressions in these rules used, but not defined and defined in Companies or in the Act (Specifications of Definition Details ) Rules, 2014 shall have the respective meanings assigned to them in the Act and the rules mentioned.

One Person Company

Only a natural person who is a Indian citizen and resident of India.

a, shall be eligible to to incorporate a One Person Company

b, shall be a nominee of a One Person Company sole member.

For this rule purpose, the term “resident in India” means a person who is stayed in India of not less than one hundred for a period and eighty two days during the immediately preceding one calendar year.

No person shall be eligible to incorporate more than a One Person Company or become nominee in such company more than one.

Where a natural person, being One Person Company member in accordance with this rule becomes a another such company member by virtue of his being a nominee in that One Person Company, such person shall meet the indicated criteria eligibility in sub-rule (2) within period of one hundred and eighty days.

No minor shall become member or the One Person Company nominee or can hold share with interest which is beneficial.

Such company cannot be incorporated or converted into a company under section 8 of the Act.

Such company cannot carry out Non-Banking financial Investment activities including investment in securities of any corp-orates body.

No company such can convert voluntarily into any kind of company unless have expired two years from the incorporation date of One Person Company, except threshold limit (paid up share capital) is beyond increased fifty lakh rupees or its average annual turnover during the period relevant exceed rupees two crore.

Nomination by the One Person company member or the subscriber.

For the first proviso purpose to sub-section (1) of section 3.

The subscriber to the One Person Company memorandum shall nominate a person, after getting such person written consent prior who shall, in the subscriber’s death event or to contract his incapacity, become that One Person Company member.

Provided that the sole member shall nominate another person as nominee within fifteen days of the notice receipt of withdrawal and shall send such nomination intimation to the company in writing, along with such other person written consent so nominated in Form No. INC.3.

The company shall within the receipt of withdrawal notice under the sub-rule (3) file with the registrar, such withdrawal of consent notice and the name of another person intimation nominated by the sole member in Form No. INC.4 along with the fee as needed in the Companies (Registration Fees and Offices) Rules 2014 and the written consent of another person such so nominated in Form No. INC.3.

Given that the company shall, of such intimation on the receipt, file with the Registrar, such change notice in Form No.INC.4 along with fee as given in the Companies (Registration Fees and Offices) Rules, 2014 and with the consent written of the new nominee in Form No. INC.3 within the receipt of thirty days of intimation of the change.

Where a One Person Company sole member ceases to the member in the event of death or to contract in capacity and his nominee becomes the One Person Company such member, such new member shall nominate within fifteen days of becoming a member, a person who shall in his death event or his incapacity to contract become such company member, and the company shall file with the registrar of such cessation intimation and nomination in Form No. INC.4. along with the fee as mentioned in the Companies ( Registration Fees and Offices) Rules, 2014 within the change in membership of thirteen days and with the prior written consent of the person so nominated in Form No. INC.3.

Penalty

If One Person Company or such company any officer contravenes these rules provisions, One Person Company any officer or One Person Company shall be punishable with fine that may extend to rupees one thousand for every day after the first during which continues such contravention.

OnePerson company to convert itself into a public company or a private company in certain cases.

Where the share capital paid up of a One Person Company exceeds fifty lakh rupees or average annual turn over during the period which is relevant exceeds rupees two crore, it shall cease to be entitled to proceed as a One Person Company.

Such One Person company shall be needed to convert itself, within six months of the date on which its share capital paid up is increased beyond rupees fifty lakhs or the relevant period last day during which its average annual turnover exceeds rupees two crore as may be the case, into either a company which is private with two members minimum and two directors or a public company with at least of seven members and three directors in respect with the provisions of section 18 of the Act.

The One Person company shall alter its memorandum and by passing the articles a resolution in respect with sub-section (3) of section 122 of the Act to give to the conversion effect and to make changes which is necessary thereto incidental.

The one Person company shall alter its memorandum and by passing a resolution of articles in accordance with sub-section (3) of section 122 of the

Act to give effect to the conversion and to make things that are important incidental thereto.

The One Person company shall within sixty days period form the date of applicability in sub-rule (1), give a notice to the Registrar in Form No INc 5 informing that it is ceased to be a One Person Company and that is required now to convert itself into a public company or private limited company by virtue of its paid-up share capital or average annual turnover having the threshold limit exceeded lain in sub-rule(1) down.

Explanation For this rule purpose,- “relevant period” means immediately the period three consecutive financial years.

If any Officer of the One Person company or One Person Company contravenes these rules provisions, One Person Company or One Person Company any officer shall be punishable with fine that may extend to rupees ten thousand and with a further fine that may extend to rupees one thousand for every day after the first during which continues such contravention.

One Person company to convert itself into a private company or public company in certain cases.

Where the share capital paid up of a One Person Company exceeds rupees fifty lakh or its average annual turnover during the relevant period extends rupees two crore, it shall cease to be entitled to continue as a One Person Company.

Such One Person Company shall be needed to convert itself, within six months of the date on which paid up share capital is increased beyond rupees fifty lakh or the last day of the period which is relevant during which its average annual turnover exceeds rupees two crore as may be the case, into either a private company with two members minimum and a public company or two directors with at least of sever members and three directors in respect with the section 18 of the Act with the provisions.

The One Person company shall alter its articles and memorandum by passing a resolution in respect with sub-section (3) of section 122 of the Act to give effect to the conversion and to make changes that are necessary thereto incidental.

The One Person Company shall within sixty days period from the applicability date of sub-rule (1) give notice to the Registrar in Form . No. INC.5 informing that it has ceased to be a One Person Company and that is needed now to convert itself into a private company or public company by virtue of its share capital paid-up or annual turnover which is average, having exceeded the laid threshold limit down in sub-rule (1)

For this rule purpose “relevant period” means the period of preceding immediately three consecutive financial years.

If One Person company any officer or one person company contravenes these rules provisions, One Person Company or the One Person Company any officer shall be punishable with fine that may extend to rupees ten thousand and with further fine that may extend to rupees one thousand for every day after the first during which continues such contravention.

A One Person Company can get itself converted into a Private or Public company after increasing the members minimum number and two directors or seven directors minimum and two or three directors as may be the case and by maintaining the paid-up capital minimum as per the requirements of the Act for such company class and by making due compliance of section 18 of the Act or conversion.

Conversion of private company into One Person Company.

A private company other than the registered company under section 8 of the Act having share capital paid up of rupees fifty lakhs or less or annual turnover which is average during the relevant period is rupees two crore or less may convert itself into one person company in the general meeting by passing a resolution.

Before passing resolution such, the company shall get no objection in writing from creditors and members.

The one person company shall file a special resolution copy with the registrar of companies within thirty days from the passing such resolution date in Form No. MGT.14.

The company shall file an application in Form No.INC.6 for its conversion into One Person Company as provided along with the fees in the Companies (Registration fees and Offices) Rules, 2014, by attaching the documents following, namely:-

The company directors shall give a declaration by way of duly affidavit sworn in confirming all that company creditors and members of the company have given for conversion their consent, the paid company share capital is rupees fifty lakhsor less or annual turnover which is average is less than rupees two crore as may be the case.

the members list and the creditors list.

the last Audited balance sheet and creditors list;

the last Balance-sheet audited and the Profit and Loss Account; and

the copy of no objection letter of creditors that are secured.

On being satisfied and with stated requirements compiled herein the registrar shall issue the certificate.

Undesirable means

In determining whether a identical proposed name with another, the differences of the following on account shall be disregarded

a, the words like Private , Pvt, Pvt., (P), Limited, Ltd , Ltd, LLP, Limited Liability Partnership;

b, appearing words at the names end—company, and company,co.,co.,corporation, corp, corpn, corp;

c, Any of the words plural version appearing in the name;

d, Type and letters case spacing between letters and punctuation marks.

e, Joining together words or the words separation does not make a distinguishable name from a name that uses similar, joined or separate words.

use of a different tense or the same word number does not distinguish one name from another.

using phonetic spellings that are different or variations of spelling shall not be considered as distinguishing one name from another.

using

phonetic spelling that are different or variations of spelling, considered as distinguishing one name from another. Illustration (For example , P.Q., industries Limited is existing then P and Q Industries or Pee Que Industries or P n Q Industries shall not be permitted and similarly if a name contains numeric character like 3, resemblance shall checked with “Three” also.

misspelled words, whether intentionally or not misspelled do not conflict with the same, words that are properly misspelled.

the addition of an related designation of an internet, such as.com,. net,. .edu,.gov,.org,. in does not make a distinguishable name form another, even where (.) is written as ‘dot’;

The words addition like Modern, new, Nav, Shri, Sri, Sree, Shree. Om, Sai, Jai, The, etc. does not make a distinguishable name from an existing name and similarly, if it is different from the existing company name only to adding the extent the name of the place, the same shall not be permitted

Different combination of the words that are same does not make a distinguishable name from an existing name e.g., if there is a company in existence by the name of “Contractors and Builders Limited’, the name contractors and Builders Limited”, the name “Contractors and Builders Limited ” shall not be permitted unless it is change name in the existing company.

if the proposed name is the English translation or Hindi or transliteration of an existing company name or limited liability partnership in Hindi or English, as may be the case.

The name shall be undesirable considered if

it attracts the provisions of section 3 of the emblems and names (Prevention and improper use) Act, 1950 (12 of 1950):

It includes a registered trade mark name or a trade mark which is an application for company registration subject, unless the consent of the owner or applicant for registration of the trademark as may be the case, has been produced and obtained by the promoters.

It includes any word or words that are offensive to any section of the people

The name shall be considered also undesirable , if-

i, the proposed name is same with or too resembles nearly the limited liability partnership

It is not in consonance with the company principal objects as set out in the memorandum of Assiociation

Provided that every name need not to be important indicative of the objects of the company but when there is some indication of objects then in the name, then it shall be in conformity with the objects mentioned in the memorandum

the main business of the company is financing, leasing, investments, chit funds, combination thereof or securities, such name shall not be permitted unless the name is indicative of related such financial activities, viz., Chit Fund or Loan or Investments, etc.,

It closely resembles the popular or abbreviated description of an limited liability Partnership ;

the proposed name is same with or too nearly resembles the company name or incorporated limited liability partnership outside India and reserved by such company or withe the registrar limited liability partnership.

Provided that if a incorporating foreign company its subsidiary in India, then the original name of company holding as it may be permitted with the addition of word India or any Indian State Name or city if available otherwise.

any part of the proposed name includes the indicative words of a seperate type of constitution of business or legal person or thereof any connotation e.g., co-operative, trust, LLP, sehkari, partnership, proprietor, society, HUF, firm, Inc., PLC, GmbH, SA, PTE, Sdn, AG etc.,

Explanation — For this sub-clause purposes, it is hereby clarified that the name including phrase “Electro Trust” may allowed for Companies registration to be formed under section 8 of the Act, in accordance with the Electoral Trusts scheme, 2013 notified by the Central Board of Direct Taxes (CBDT)

Given that the application name is accompanies with an affidavit to the effect that the name to be obtained shall be for the purpose of companies registration only under Electoral Trust Scheme as notified by the Central Board of Direct Taxes

the proposed name includes the words ‘British India’;

the proposed name implies connection or association with embassy or consulate or a foreign government.

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