Introduction

The Ministry of Corporate Affairs has notified the Companies (Incorporation) Second Amendment Rules, 2017 to amend the Companies (Incorporation) Rules, 2014, vide notification dated July 27, 2014.[1] The Companies (Incorporation) Second Amendment Rules, 2017 (hereinafter referred to as the “Amendment Rules”) shall come into force from the date of publication in the Official Gazette.

The Ministry has amended the provisions of Rule 28 (Shifting of Registered office within the same state) and Rule 30 (Shifting of Registered Office from one state or Union Territory to another state) of the Companies (Incorporation) Rules, 2014 (hereinafter referred to as the “Principal Rules”).

Shifting of Registered office within the same state

Provision as per Amendment Rules

Rule 28 of the Amendment Rules states that to shift the registered office of a company within the same state from the jurisdiction of one Registrar of Companies to the jurisdiction of another Registrar of Companies, an application is to be filed with the Regional Director in Form INC 23. Form INC 23 is to be submitted along with the requisite fee and the following documents:

  • Board Resolution for shifting of registered office
  • Special Resolution of the members of the company approving the shifting of registered office
  • A declaration given by the Key Managerial Personnel or any two directors authorized  by the Board, that the company has not defaulted in payment of dues to its workmen and has either the consent of its creditors for the proposed shifting or has made necessary provision for the payment thereof
  • A declaration not to seek change in the jurisdiction of the Court where cases for prosecution are pending
  • Acknowledged copy of intimation to the chief Secretary of the State as to the proposed shifting and that the employees interest is not adversely affected consequent to proposed shifting

How Rule 28 of Amendment Rules is different from the Principal Rules

As per Rule 28 of the Principal Rules, the company seeking to carry out change in address of registered office within the state, in addition to submitting Form INC 23 to Regional Director, had to publish a notice in a daily newspaper in English and in the principal language of that district in which the registered office of the company is situated. Such company also had to serve notice on each debenture holder, depositor and creditor of the company indicating the matter of the application. However, such requirements have been done away with in the Amendment Rules.

Further, Rule 28 in the Principal Rules also consisted of the proviso that a company will not be allowed to shift the registered address if any inquiry, inspection or investigation had been initiated against the company or any prosecution was pending against the Company under the Companies Act, 2013. The Amendment Rules do not consist of any such provision, hence, allowing such companies to file application for change in registered office.

Shifting of Registered Office from one state or Union Territory to another state

As per Rule 30 of the Amendment Rules, to shift the registered office of a company from one state or Union Territory to another state, the company has to submit an application seeking approval for alteration of memorandum with respect to such change to the Central Government. Such application is to be filed in Form INC 23 along with the requisite fee and the following documents:

  • a copy of Memorandum of Association along with proposed alterations
  • a copy of the minutes of the General Meeting at which the resolution authorizing such alteration was passed, giving details of  the number of votes cast in favour or against the resolution
  • a copy of Board Resolution or Power of Attorney or the executed vakalatnama, as the case may be

The Company shall also be required to advertise in Form INC-26 in Vernacular Newspaper, English Newspaper with the widest circulation in the state in which the Registered Office of the Company is situated, within 30 days of filing of Form INC 23. As per the Principal Rules, such advertisement had to be made within 14 days of filing of application.