NAME APPROVAL GUIDELINES FOR COMPANIES UNDER COMPANIES ACT, 2013
NAME APPROVAL GUIDELINES
FOR COMPANIES UNDER COMPANIES ACT, 2013
In old Companies Act, 1956
Ministry had issued name availability guidelines by way of (Companies (Name
Availability) Rules, updated in 2011). In the new Companies Act, 2013 name availability
guidelines for Company are given under Rule 8 of the Companies (Incorporation)
Rules, 2014. Given below are precautions
that must be kept in mind while applying for the proposed Name of a Company.
FIRST PRECAUTION[1]:
The name of the Company
should END with
·
the last word “Limited” in the case of a public limited Company,
or
·
the last words “Private Limited” in the case of a private
limited Company
Ø Section-8 Company and
Government[2]Company
is not required to mention Limited or
Private Limited in its name.
SECOND PRECAUTION:
Proposed name
should NOT be identical
with another existing name
Meaning
of word Identical:
·
Similar or alike in every way:
e.g. the two cars are identical except for their license plates.
·
Being the very same; self
same :e.g. this is the identical room we stayed in last year.
Synonyms Expand: Congruous, Congruent, Equal, Matching.
[Antonyms] Trying
using the identical tech
THIRD PRECAUTION:
The name shall be considered undesirable, if;
I.
it attracts the provisions of section 3 of
the [3]Emblems and Names (Prevention and
Improper Use) Act, 1950 (12 of 1950)
II.
It includes the name of a registered trade
mark or a trade mark which is subject of an application for registration
EXCEPT:
If Proposed name includes the name of a
registered trade mark or a trade mark which is subject of an application for
registration, Then for approval of proposed name CONSENT of the owner or applicant for registration as the
case may be, shall be required to be obtained and produced by the promoters.
III.
It includes any word or words which are Offensive to any section of the
people. e.g., proposed name does not contain profanity or words or phrases that
are generally considered a slur against an ethnic group, religion, gender or
heredity
FOURTH PRECAUTION:
The following words and combinations thereof shall not be
used in the name of a Company in English or any of the languages depicting the
same meaning.
NOTE:
For using the below given name, the previous approval of the Central
Government[4]
required to obtained.
(a)
Board; (b)
Commission; (c)
Authority;
(d)
Undertaking; (e)
National; (f)
Union;
(g)
Central; (h)
Federal; (i)
Republic;
(j)
President; (k)
Rashtrapati; (l)
Municipal
(m)
Small Scale Industries; (n)
Panchayat; (o)
Minister;
(p)
Nation; (q) Forest corporation; (r)
Governor;
(s)
Statute or Statutory; (t)
Court or Judiciary; (u)
Bureau
(v)
Development Scheme;
(w) Khadi and Village Industries Corporation;
(x)
Financial, Corporation and the like; (y) Prime Minister or Chief Minister;
(z)
Development Authority;
(aa)
the use of word Scheme with the name of Government (s),State, India, Bharat or
any
Government
authority or in any manner resembling with the schemes launched by Central,
state or local Governments and authorities; and
NOTE:
As per condition no. 4 (Four) it is clear that use of the word
INDIA/ Name of State, Bharat in name of the company is not restricted .
FIFTH PRECAUTION:A Company can be incorporated with the name in earlier use in any other business constitution like Sole
proprietor or Partnership or any other incorporated or unincorporated entity by
the promoter.
The applicant shall declare in affirmative or
negative, whether they are using or have been using that name for the last five years, the name applied for
incorporation of Company or LLP in any other business constitution like Sole
proprietor or Partnership or any other incorporated or unincorporated entity.
IF, YES details
thereof and No Objection
Certificate from other partners and associates for use of such name by the proposed
Company or LLP, as the case may be, and, Also a declaration as to whether such
other business shall be taken over by the proposed Company or LLP or not.
SIXTH PRECAUTION:
I. Use of the name of a Foreign Country:
If The proposed name
includes name of any foreign country or any city in a foreigncountry, the same
shall be allowed if the applicant produces any proof of significance of
business relations with such foreign country like Memorandum of Understanding
with
a Company of such country.
II. Commodity Exchange:
Ministry of Corporate affairs
issued a circular with regard to use of word “Commodity Exchange” vide
“Circular 26/2014” dated 27th June, 2014.
Use of the word “Commodity
Exchange” may be allowed only where a ‘No Objection Certificate’ from the
forward Markets (FMC) is furnished by the applicant.
III. Insurance’, ‘Bank’, ‘Stock
Exchange’, ‘Venture Capital’, ‘Asset Management’, ‘Nidhi’, ‘Mutual fund :
Use of the word “Insurance’, ‘Bank’, ‘Stock Exchange’, ‘Venture
Capital’, ‘Asset Management’, ‘Nidhi’, ‘Mutual fund” may be allowed only where
a declaration is submitted by the applicant that the requirements mandated by
therespective regulator, such as IRDA, RBI, SEBI, MCA etc. have been complied
withby the applicant.
IV. Name of continent, country, state, city only :
The proposed name can’t contain only the name of a continent, country,
state, and city. E.g. such as Asia limited, Germany Limited, Haryana Limited,
Mysore Limited.
V. Identical with or too nearly resembles the name of a Company
incorporated outside India:
The proposed name should not be identical with or too nearly resembles
the name of a Company or limited liability partnership incorporated outside
India and reserved by such Company or limited liability partnership with the
Registrar.
EXCEPT:
A foreign Company is incorporating its subsidiary Company in India,then
the original name of the holding Company as it is may be allowed with
theaddition of word India or name of any Indian state or city, if otherwise
available
VI.
Name include financing, leasing, chit fund, investments, securities:
If main business of proposed Company is financing, leasing, chit fund,
investments, securities or combination there of, the name of Company should be indicative
of such related financial activities.
VII.
Change in Name of Company:
The names released on change of name by any company shall remain in
data base and shall not be allowed to be taken by any other company including
the group company of the company who has changed the name for a period of three
years from the date of change subject to specific direction from the competent
authority in the course of compromise, arrangement and amalgamation.
MANDATORY
WORDS FOR SECTION 8 COMPANY:
The name shall
include the words Foundation, Forum, Association, Federation, Chambers,
Confederation, council, Electoral trust and the like etc.
MANDATORY
WORDS FOR NIDHICOMPANY:
Every Company incorporated
as a “Nidhi” shall have the last word ‘Nidhi Limited’ as part of its name
MAJOR
AMENDMENT
The Ministry of Corporate Affairs (MCA), vide notification dated
January 22, 2016, issued the Companies (Incorporation) Amendment Rules, 2016,
wherein rule 8, rule 9 and rule 36 of Companies (Incorporation) Rules, 2014
(hereinafter referred to as the principal rules), have been amended.
Name in line with Activity:
Earlier before this amendment Name of the Company name of the Company
should be in consonance with the principle objects of the Company, but
situation after amendment is different, after amendment provisions are as
follow:
Omissions:
i. The name which is not in consonance with the principal objects of the
company as set out in the memorandum of association.
ii.
If any company has changed its activities, which
are not reflected in its name, shall not be required to change its name in line
with its activities.
iii.
The name which is intended or likely to produce a
misleading impression regarding the scope or scale of its activities which
would be beyond the resources at its disposal.
Effects:
i.
No need to reflect the object of Company in Name of
the Company.
ii.
No need to change the name of the Company while
altering the activity of the Company.
Name in line with Name of
Promoter:
Earlier Abbreviation of name of promoters was not allowed to apply for
the name and if name include the name of the person other then promoter then
NOC was required or name include the name of the relative then relationship
proof was required. but situation after amendment is different, after amendment
provisions are as follow:
Omissions:
i.
The proposed name is vague or an abbreviated name
such as 'ABC limited' or '23K limited' or abbreviated name based on the name of
the promoters;
ii.
if the key word used in the name proposed was the
name of a person other than the name(s) of the promoters or their close blood
relatives, No objection from such other person(s) was required with the
application for name. Also, in case the proposed name included the name of
relatives, proof of relation was required to be furnished, along with the
significance and proof thereof for use of coined words made out of the name of
the promoters or their relatives
Effects:
i.
Company can be incorporate with the abbreviated
word of the name of the promoters.
ii. The obstructions of using the name of persons other
than promoters or their close blood relatives has been removed. Now there is no
requirement of furnishing proof of relationship for the as the name of the
company.
KEY
POINTS:
S. NO.
|
WORD
|
USE OF WORD
|
A.
|
State
|
The proposed name includes the word “State”, the same shall be
allowed only in case the Company is a government Company.
|
B.
|
Corporation/ Financial
|
The word “Corporation/ Financial” is available with permission of
Regional Director.
|
C.
|
LLP in liquidation
|
The name of limited liability partnership in liquidation or the
limited liability partnership which is struck off. Such name is not available
upto a period of Five Years.
|
D.
|
Company name Struck Off
|
if the proposed name is identical with the name of a Company which is
struck off in pursuance of action under section 248 of the Act, then the same
shall not be allowed before the expiry of Twenty Years from the publication in the Official Gazette
being so struck off
|
E.
|
Change in Name of Company
|
The names released on change of name by any company shall remain in
data base and shall not be allowed to be taken by any other company including
the group company of the company who has changed the name for a period of
three years from the date of change.
|
(Author – CS Divesh Goyal, GOYAL DIVESH
& ASSOCIATES Company Secretary in Practice from Delhi and can be
contacted at csdiveshgoyal@gmail.com)
Disclaimer: The entire contents of this
document have been prepared on the basis of relevant provisions and as per
the information existing at the time of the preparation. The observations
of the author are personal
view and the authors do not take responsibility of the same and this cannot
be quoted before any authority without the written.
|
[1]
This Clause is not applicable to Section
8 Company and Government Company.
[2]
For the Government Companies, the last word “Limited” in the case of a
public limited company, or the last words “Private Limited” in the case of a
private limited company shall be omitted.( notification No. G.S.R. 463(E) dated
5th June, 2015)
[3]Prohibition of improper use of certain
emblems and names. -Notwithstanding anything contained in any law for the time being
in force, no person shall, except in such cases and under such conditions as
may be prescribed by the Central Government use, or continue to use, for the
purpose of any trade, business, calling or profession, or in the title of any
patent, or in any trade mark or design, any name or emblem specified in the
Schedule or, any colorable imitation thereof without the previous permission of
the Central Government or of such officer of Government as may be authorized in
this behalf by the Central Government
[4]
Power of Central Government delegated to Regional Director
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