ALTERATION OF OBJECT CLAUSE

Section 13 (8) & (9) of the Companies Act, 2013 read with Rule 34 of the Companies
(Incorporation) Rules, 2014 and Secretarial Standards 1 provide for the alteration of object
clause of the company.

STEPS PARTICULARS/ PROVISIONS TIMELINE FORMS PENALTY

1) Convene Board Meeting Every officer of
7 days before the company whose
 Issue Notice of Board Meeting to the date of duty is to give
all the directors of company at least Board notice under this
7 days before the date of Board Meeting. section and who
Meeting. fails to do so shall
 Such notice must be in writing to be liable to a
every director at his address penalty of twenty-
registered with the company and five thousand
such notice shall be sent by hand rupees. 3
delivery or by post or by electronic
means.1
 Meeting at Shorter notice – Proviso
to Sub- section 3 to Section 173
provides that a meeting of the
Board may be called at shorter
notice to transact urgent business
subject to the condition that at least
one independent director, if any,
shall be present at the meeting.
 Further, in case of absence of
independent director from such a
meeting of the Board, decisions
taken at such a meeting shall be
circulated to all the Directors and
shall be final only on ratification
thereof by at least one independent
1
Section 173(3), The Companies Act, 2013
 director, if any. [Second proviso to
Section 173(3)]
 The following also needs to be
sent:2
1) Attach Agenda
2) Notes on Agenda
3) Draft resolution
2) Held Board Meeting4
 Conduct the Board Meeting
proposing the alteration in the
object clause
 Pass the Board Resolution
considering the amended set of
MOA.
 Get the approval to change the
object clause and recommend the
proposal for consideration by
members. 5
 Get approval of notice of General
Meeting. (EGM)
 Fix the date, time and venue of
such meeting and director or any
other person to send the notice for
the same to the members.
3) Issue Notice of EGM At least 21
days prior to
 The notice of EGM shall be given conducting
at least 21 days prior to the the meeting
meeting either in writing or
through electronic mode in
2
Secretarial Standards 1.3.7 and 6.2.1, available at https://www.icsi.edu/media/webmodules/Final_SS-1.pdf
Other Standards can also be referred in regards to this notice.
Rule 5, The Companies (Meetings of Board and its Powers) Rules, 2014
3
Section 173(4), The Companies Act, 2013
4
Secretarial Standards 1
5
Section 13(8), The Companies Act, 2013
 accordance with Rule 18.6
 Calling at shorter notice – where
the consent by at least majority in
number and ninety five percent of
such part of the paid up share
capital of the company giving a
right to vote at such a meeting is
accorded. [for company having
share capital – Section 101(1)(ii)
(a)]
Consent of not less than ninty-five
per cent. of the total voting power
exercisable at that meeting. [for
company having no share capital
– Section 101(1)(ii)(b)]
 The notice must specify the place,
date, day and the hour of the
meeting and shall contain a
statement of the business to be
transacted at such meeting.7
 The notice shall be given to the
following:8
 every member of the
company, legal
representative of any
deceased member or the
assignee of an insolvent
member.
 The auditor or auditors of
the company.

6
Section 101 (1), Section 13(8), The Companies Act, 2013 read with Rule 18, The Companies (Meetings of
Board and its Powers) Rules, 2014
7
Section 101(2), The Companies Act, 2013
8
Section 101(3), The Companies Act, 2013
  Director of the company.
 Sub section 4 to section 101
provides that an accidental
omission to give notice to, or the
non-receipt of such notice by, any
member or other person who is
entitled to such notice for any
meeting shall not invalidate the
proceedings of the meeting.
4) Conduct General Meeting
 Check Quorum - he quorum for a
meeting of the BOD of
a company shall be  1/3 of its total
strength or two Directors,
whichever is higher, and the
participation of the Directors by
video conferencing or by other
audio visual means shall also be
counted for the purposes of
quorum.9
 Check whether the Auditor is
present - All notices of, and other
communications relating to, any
general meeting shall be forwarded
to the auditor of the company, and
the auditor shall, unless otherwise
exempted by the company, attend
either by himself or through his
authorised representative, who
shall also be qualified to be an
auditor, any general meeting and
shall have right to be heard at such
meeting on any part of the business
9
Section 174(1), Companies Act, 2013 and SS 3 of SS-1
 which concerns him as the
auditor.10
 Pass special resolution in
accordance with Section 114(2) of
the Act.
 The votes cast in favour of the
resolution, whether on a show of
hands, or electronically or on a
poll, as the case may be,
by members who, being entitled so
to do, vote in person or by proxy or
by postal ballot, are required to be
not less than three times the
number of the votes, if any, cast
against the resolution by members
so entitled and voting.11
5) File special resolution 30 days of Form Failure to do so
A copy of the resolution together with the the passing MGT 14 would attract
explanatory statement under Section 102 the special penalty of ten
of the act, if any, annexed to the notice resolution thousand rupees
calling the meeting in which the resolution and in case of
is proposed, shall be filed with continuing failure,
the Registrar in Form MGT 14 within 30 with a further
days of the passing along with the fees penalty of one
prescribed in the Annexure.12 hundred rupees for
each day after the
first during which
such failure
continues, subject
to a maximum of
two lakh rupees
10
Section 146, Companies Act, 2013
11
Section 114(2)(c), Companies Act, 2013
12
Section 117(1), 102 of the Companies Act, 2013 read with Rule 24, Company (Management and
Administration) Rules, 2014
 and every officer of
the company who
is in default
including liquidator
of the company, if
any, shall be liable
to a penalty of ten
thousand rupees
and in case of
continuing failure,
with a further
penalty of one
hundred rupees for
each day after the
first during which
such failure
continues, subject
to a maximum of
fifty thousand
rupees.13
6) Approval from the Registrar of 30 days from
Companies and Issuance of new the date of
certificate of incorporation filing the
The Registrar will register any alteration of resolution.
the MOA with respect to the objects of
the company and certify the registration
within a period of thirty days from the date
of filing of the special resolution in
accordance with clause (a) of sub-section
(6) of Section 13.

13
Section 117(1) the Companies Act, 2013 (Proviso)