In a bid to ease the process of registration of company in India, MCA vide notification dated 22nd January 2016 has established Central Registration Centre (CRC) at Indian Institute of Corporate Affairs (MCA), Plot No. 6,7,8, Sector 5, IMT Manesar, District Gurgaon (Haryana), Pin Code- 122050, having territorial jurisdiction all over India, for discharging or carrying out the function of processing and disposal of applications for reservation of names under the provisions of the said Act.
The CRC shall function under the administrative control of Registrar of Companies, Delhi (ROC Delhi), who shall act as the Registrar of the CRC until a separate Registrar is appointed to the CRC. The CRC shall process applications for reservation of name i.e., e-Form No. INC-1 filed along with the prescribed fee as provided in the Companies (Registration of Offices and Fees) Rules, 2014.
Processing and approval of name or names proposed in e-Form No.INC-29 shall continue to be done by the respective Registrar of Companies having jurisdiction over incorporation of companies under the Companies Act, 2013 as per the provisions of the Act and the rules made thereunder.
The CRC shall come into force from 26th January, 2016.
Impact: This will have a significant impact on the name approval process as it will reduce the time taken by RoC for name approval and most importantly dispense with the discretionary practices being followed at different ROC’s. But MCA should promote registration of Company through INC-29 instead of the customary route.
Further MCA vide notification dated 22nd January 2016 has also amended the Companies (Incorporation) Rules 2014 through Companies (Incorporation) Amendment Rules, 2016 to ease the name approval process. The gist of amendment is outlined below:
Amendment in Rule 8
Sub-clause (ii) of clause (b) of Rule 8(2) shall be omitted
Text of omitted rule is given below:
“It is not in consonance with the principal objects of the company as set out in the memorandum of association;
Provided that every name need not be necessarily indicative of the objects of the company, but when there is some indication of objects in the name, then it shall be in conformity with the objects mentioned in the memorandum;”
Impact: No requirement that name should have object or it if has object, it should relate to the activity being carried by the company.
Sub-clause (x) of clause (b) of Rule 8(2) shall be omitted
Text of omitted rule is given below:
“The proposed name is vague or an abbreviated name such as 'ABC limited' or '23K limited' or 'DJMO' Ltd: abbreviated name based on the name of the promoters will not be allowed. For example:- BMCD Limited representing first alphabet of the name of the promoter like Bharat, Mahesh, Chandan and David:
Provided that existing company may use its abbreviated name as part of the name for formation of a new company as subsidiary or joint venture or associate company but such joint venture or associated company shall not have an abbreviated name only e.g. Delhi Paper Mills Limited can get a joint venture or associated company as DPM Papers Limited and not as DPM Limited:
Provided further that the companies well known in their respective field by abbreviated names are allowed to change their names to abbreviation of their existing name after following the requirements of the Act;”
Impact: Promoter can keep any name for their Company and it will not be rejected on the ground of being vague
Sub-clause (xvii) of clause (b) of Rule 8(2) shall be omitted
Text of omitted rule is given below:
“it 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”
Sub-rule (3) Rule 8 shall be omitted
Text of omitted rule is given below:
“If any company has changed its activities which are not reflected in its name, it shall change its name in line with its activities within a period of six months from the change of activities after complying with all the provisions as applicable to change of name.”
Impact: No need to change the name in case of change in business activities
Sub-rule (4) Rule 8 shall be omitted
Text of omitted rule is given below:
In case the key word used in the name proposed is 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) shall be attached with the application for name. In case the name includes the name of relatives, the proof of relation shall be attached and it shall be mandatory to furnish the significance and proof thereof for use of coined words made out of the name of the promoters or their relatives.
Impact: No need to obtain the approval of a person , whose name is being used in the name
Amendment in Rule 9
Existing Rule 9 shall be substituted by the following :
“9. Reservation of name – An application for the reservation of a name shall be made in Form No. INC. 1 along with the fee as provided in the Companies (Registration offices and fees) Rules, 2014 which may be approved or rejected, as the case may be, by the Registrar, Central Registration Centre.”
Text of existing rule is given below:
“Reservation of name.-
An application for the reservation of a name shall be made in Form No. INC.1 along with the *fee as provided in the Companies (Registration offices and fees) Rules, 2014.”
Amendment in Rule 36
In sub-rule (12) after sub-clause (b), the following shall be inserted.-
‘(ba) After the resubmission of the documents and on completion of second opportunity, if the registrar still finds that the documents are defective or incomplete, he shall give third opportunity to remove such defects or deficiencies;’
Provided that the total period for re-submission of documents shall not exceed a total period of thirty days.
In sub-rule (12) in sub-clause (c), for the words ‘two opportunities’, the words ‘three opportunities’ shall be substituted.
Text of existing rule is given below:
“(12) (a) Where the Registrar, on examining e-form INC-29, finds that it is necessary to call for further information or finds such application or document to be defective or incomplete in any respect, he shall give intimation to the applicant to remove the defects and re-submit the e-form within fifteen days from the date of such intimation given by the Registrar.
(b) After the resubmission of the document, if the registrar still finds that the document is defective or incomplete in any respect, he shall give one more opportunity of fifteen days to remove such defects or deficiencies.
(c) In case, the Registrar is of the opinion that the document is defective or incomplete in any respect after giving such two opportunities, the e-form INC-29 of the proposed company shall be rejected.”
Impact: In case of Form INC-29 now instead of two, three opportunities will be provided for resubmission
Substitution of Form
For the existing Form No.INC-1, new form no. INC-1 shall be substituted
Download :
- Companies (Incorporation) Amendment Rules, 2016.
- Notification No. S.O. Dated – January 22, 2016 under section 396 of Companies Act, 2013