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MOA Amendment

About MOA Amendment of Section 8 company

MOA Amendment of Section 8 Company refers to the process of modifying the company’s MOA to reflect any changes in its objectives, structure, or operations. This amendment may be necessary to align the company’s activities with evolving goals or legal requirements. The process involves approval from the company’s members, passing of special resolutions, and filing with the Registrar of Companies (ROC), ensuring compliance with the relevant provisions of the Companies Act, 2013.

Amendment of the MOA in a Section 8 company may be required when there’s a need to:

  • Change the company’s objectives.
  • Alter the name of the company.
  • Modify the registered office address.
  • Alter the liability of members or the authorized share capital.

At Legal Helpzyn, we assist Section 8 Companies in amending their MOA to align with their charitable objectives. Our services include drafting resolutions, ensuring compliance with the Companies Act, 2013, and filing with the Registrar of Companies (ROC). Trust us to handle your MOA amendment efficiently and legally.

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    The process of amending the MOA of a Section 8 company is governed by the Companies Act, 2013, particularly the provisions under:

    • Section 8: Deals with the formation and registration of Section 8 companies, which are non-profit organizations.
    • Section 13: Deals with the alteration of the MOA, including changing the company's objectives or registered office address.
    • Rule 32 of the Companies (Incorporation) Rules, 2014: This rule provides further guidelines for filing an amendment application.

    The Memorandum of Association can be amended for various reasons, such as:

    • Change in objectives: The company may need to update its primary objectives to include new charitable or non-profit activities.
    • Change in name: The company might want to change its name to reflect its expanded activities or to improve its identity.
    • Alteration of registered office address: The location of the registered office may change, requiring an amendment to the MOA.
    • Increase in authorized capital: If the company is planning to issue more shares or securities, this would need to be reflected in the MOA.

    Some amendments to the MOA require additional considerations:

    • Change in Name: If the change in name is due to certain reasons like similarity with an existing company, approval from the ROC or other regulatory authorities might be required.
    • Alteration of Objects: If the object clause is being altered to include new business activities, the company may need to obtain a Special License from relevant authorities, especially if it deals with regulated industries (e.g., banking, insurance, etc.).
    • Increase in Share Capital: The company must pass a resolution to increase the share capital and file the necessary forms with the ROC.

    Steps Involved in MOA Amendment of Section 8

    The first step in amending the MOA is the approval of the proposed changes by the company’s board of directors. A Board Meeting is held, and a resolution must be passed to approve the amendments to the MOA.

    After the board approves the amendment, the next step is to pass a Special Resolution in a General Meeting (GM) of the members of the Section 8 company. The Special Resolution requires a 75% majority vote of the members present at the meeting.

    • A notice of the GM should be sent to all members, and the proposed amendment should be included in the notice.
    • The shareholders must approve the amendment through a Special Resolution, as per Section 114 of the Companies Act, 2013.

    Once the Special Resolution is passed, the amendment must be filed with the Registrar of Companies (RoC). This is done by submitting the following documents:

    1. Form MGT-14: This is required for filing the Special Resolution with the RoC. It must be filed within 30 days of passing the resolution.
    2. Form INC-24: This is the form used for seeking approval from the central government for the amendment (especially for changes to the company’s objects, name, etc.). This form may be required if the company is altering its objectives or making other significant changes.
    3. Altered Memorandum of Association: The amended MOA document must be submitted with the prescribed changes.

    In the case of certain amendments, particularly changes in objectives or name of the Section 8 company, approval from the Central Government (through the Ministry of Corporate Affairs) is required. This step is crucial for ensuring that the company continues to comply with the charitable purposes it was originally formed for.

    • The company has to seek approval from the Ministry of Corporate Affairs (MCA) by filing Form INC-24.
    • If the amendment affects the company’s non-profit status or if the company’s activities significantly diverge from its original charitable purposes, the MCA may require additional documentation or reasons for the change.

    If the RoC or the MCA (as required) is satisfied with the documents and the resolution, they will issue a Certificate of Amendment. This certificate will indicate that the changes to the MOA have been legally approved.

    Tax and Regulatory Considerations

    Section 8 companies enjoy tax exemptions, but any amendment to the MOA that alters the nature of the company’s activities may impact its tax-exempt status. If the company starts engaging in profit-making activities, it could lose its non-profit status under the Income Tax Act and no longer enjoy tax exemptions.

    • It is important to notify the Income Tax Department if there is any significant change in the nature of activities or objectives of the company that may affect its tax-exempt status.

    Specific Provisions for Section 8 Companies

    • Non-profit character: Any amendment to a Section 8 company’s MOA must ensure that the company continues to fulfill its non-profit purpose.
    • Transfer of assets: Any amendment involving changes in the distribution of assets or dividends is prohibited.
    • Voluntary dissolution: If the company ceases to exist or is dissolved, its assets must be transferred to another non-profit entity with similar objects.

    How we work

    1.png

    Fill the form & pay the required charges.

    2

    Receive a call from our CA experts

    3

    Upload the documents as per the request

    4

    The expert will prepare the MOA amendments and request your approval.

    5

    Submit Form MGT-14 to the ROC and process the MOA amendment.

    How we work

    • A Special Resolution is required for any amendments.
    • The company must maintain its non-profit status for amendments to be approved.
    • Ministry of Corporate Affairs approval may be necessary for certain types of changes, particularly regarding objectives.
    • Filing of forms with the RoC is required to finalize the process.

    Frequently Asked Questions (FAQs)

    A Section 8 company is a non-profit organization registered under the Companies Act, 2013. It is formed for charitable purposes such as promoting arts, education, science, religion, commerce, sports, social welfare, or environmental protection. The company does not distribute profits to its members and must use its income solely to further its objectives.

    The MOA of a Section 8 company may need to be amended due to several reasons, such as:

    • Changing the company’s objectives (e.g., adding new charitable activities).
    • Changing the company’s name to better reflect its mission or activities.
    • Changing the registered office address.
    • Increasing authorized capital or altering other structural details (though Section 8 companies typically don’t issue shares).

    The MOA of a Section 8 company can be amended by following a formal procedure:

    • Board approval: The Board of Directors must approve the proposed amendment in a board meeting.
    • Special Resolution: A Special Resolution must be passed by the members of the company in a General Meeting (GM) with at least 75% approval.
    • Filing with RoC: Once the Special Resolution is passed, the company must file the resolution and amended MOA with the Registrar of Companies (RoC) using Form MGT-14.
    • Central Government Approval (if required): If the amendment involves changes to the objectives or name, the company must seek approval from the Ministry of Corporate Affairs (MCA) through Form INC-24.

    A Special Resolution is a resolution passed by a 75% majority of the members (voting in favor) in a General Meeting. It is required for major decisions such as changing the name, objectives, or the registered office address of the company.

    Yes, MCA approval is mandatory if the amendment involves:

    • Changing the objectives of the Section 8 company.
    • Changing the name of the company. For these types of amendments, the company must file Form INC-24 with the MCA to obtain approval.

    The key documents required for the amendment of the MOA include:

    1. Board Resolution approving the amendment.
    2. Special Resolution passed by the members in the General Meeting.
    3. Notice of GM to members about the proposed amendment.
    4. Altered MOA reflecting the changes.
    5. Form MGT-14 for filing the Special Resolution with the RoC.
    6. Form INC-24 (if applicable) to seek approval from the MCA for changes in objectives or name.
    7. Proof of address (if changing the registered office).
    8. Digital Signature Certificate (DSC) for signing and filing e-forms.

    The entire process of amending the MOA of a Section 8 company can take around 2-3 weeks, depending on the complexity of the changes and the need for approval from the Ministry of Corporate Affairs (MCA). If MCA approval is required, it may take additional time.

    Yes, a Section 8 company can change its objectives, but such amendments require approval from the Ministry of Corporate Affairs (MCA), especially if the new objectives significantly alter the non-profit or charitable nature of the company. The company must demonstrate that the new objectives are still in line with its non-profit status.

    Yes, a Section 8 company can change its name, but it needs approval from the Registrar of Companies (RoC) and the MCA, especially if the name change affects the company’s non-profit status or objectives. The company must file Form INC-24 to seek approval from the MCA.

    Yes, there are fees associated with filing the forms required for MOA amendments, such as:

    • Filing Form MGT-14: The filing fee for this form depends on the authorized capital of the company.
    • Filing Form INC-24: There may also be fees for seeking approval from the MCA for changes to the company’s objectives or name. These fees can vary, and the latest fee structure can be checked on the MCA website.

    No, a Section 8 company is a non-profit organization by definition. If the company wants to start engaging in for-profit activities, it would need to convert into a for-profit company (such as a Private Limited Company or Public Limited Company) by following the legal process of conversion under the Companies Act, 2013.

    If the amendment to the MOA violates the provisions of the Companies Act, 2013 or the non-profit nature of the company, the Registrar of Companies (RoC) or the Ministry of Corporate Affairs (MCA) may reject the amendment. Additionally, it may lead to penalties or legal action, especially if the amendment causes the company to lose its non-profit status.

    Yes, a Section 8 company can change its registered office address, but it needs to pass a Special Resolution in the General Meeting and file the altered MOA with the RoC along with Form MGT-14. Proof of the new address, such as ownership documents or a rental agreement, will also be required.

    After the amendment is approved by the RoC or MCA, the company will receive a Certificate of Amendment from the RoC, which confirms the changes to the MOA. The company should update its records, including any external documents or websites, to reflect the amended MOA.

    Yes, Section 8 companies are restricted in terms of:

    • Profit distribution: The company cannot amend its MOA to allow profit distribution to its members.
    • Non-profit nature: Any changes should not violate the non-profit status of the company. For instance, a Section 8 company cannot amend its MOA to engage in commercial or profit-making activities.
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