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Change in Objects Clause

CA Sandeep Kumar (Audit Assistant) (804 Points)

26 November 2010

Hi members i have a doubt.

A company was into real estate business till date, and due to decline market value of properties the company is not able to survive in the existing business, therefore the company intends to venture into hotel industry. Hotel will be set up in the land owned by the company. Issue is, hotel business is not in the objects clause? Please advise whether alteration can be made to objects clause incorporating hotel business, bearing in mind provisions of section 17 (1)..

Also, post any case laws/circulars in this topic

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18 Replies

Ajay Mishra (Company Secretary) (74337 Points)
Replied 27 November 2010

Yes, You can ad Hotal Business in main object of the company subject to the approval of ROC.

Regards

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CA Sandeep Kumar (Audit Assistant) (804 Points)
Replied 27 November 2010

thank you sir

Neha Gupta (PCS) (377 Points)
Replied 27 November 2010

Yes Sunny Ji, by filing Form 23 with concerned ROC you can alter the main object clause of MOA of the Company.

There is one thing that you should take care off that the name of the Company also reflect the Multi purpose business activity as you are entering a new business activity which is not specified in MOA of the Company. If not so then you can add this main object as a “Note” in the Main Object clause on MOA of the company without changing the name of the Company.

Regards

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CS Ankur Srivastava (Company Secretary & Compliance Officer) (17853 Points)
Replied 27 November 2010

Dear Sunny,

Just pass special resolution and change the object clause of MOA. Then file form 23.

1 Like

Manmohan ACA, CS (Chartered Accountant ) (14243 Points)
Replied 27 November 2010

Just pass special resolution and change the object clause of MOA. Then file form 23.

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Santhosh Poojary (SIEMPRE AHÍ PARA TI) (15607 Points)
Replied 27 November 2010

Will have to pass Special Resolution to make change in object clause

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CA Sandeep Kumar (Audit Assistant) (804 Points)
Replied 27 November 2010

Thanks a lot members,

With what Neha has said i have another query now.. the name of the company is associated only with real estate business, will there have to be a change in name>??

Thanks neha to have highlighted that point too

Neha Gupta (PCS) (377 Points)
Replied 27 November 2010

Well Sunny ji, in my opinion Setting up Hotels and other Commercials Buildings is part of Real estate Business. Here you just pass S.R. for alteration in MOA with out applying for a new name/ changing the existing name because the main Stream of the Business is not changing here.

Its just addition of another Similar kind of Object is the Main Objects of the Company.

But you should also check the existing clauses of MOA whether they are similar to this new object or not.

Plz correct me if i am wrong members.

Regards.

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CS Ankur Srivastava (Company Secretary & Compliance Officer) (17853 Points)
Replied 27 November 2010

Agree with Ms. Neha.....

Mohit Srivastava (Article) (131 Points)
Replied 27 November 2010

hi sunny for change in object clause

1-pass special resolution(not required CG Approval for this)

2-alteration will deemed for change if alteration is for special perpose u/s 17

3-after passing SR with 1 month company should informe the ROC

tahnk you

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Mohit Srivastava (Article) (131 Points)
Replied 27 November 2010

hiiiiiiiiiiii sunny

Mohit Srivastava (Article) (131 Points)
Replied 27 November 2010


Originally posted by : suny
	Hi members i have a doubt. A company was into real estate business till date, and due to decline market value of properties the company is not able to survive in the existing business, therefore the company intends to venture into hotel industry. Hotel will be set up in the land owned by the company. Issue is, hotel business is not in the objects clause? Please advise whether alteration can be made to objects clause incorporating hotel business, bearing in mind provisions of section 17 (1).. Also, post any case laws/circulars in this topic