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Microlesson · 5-min read

Alteration of Memorandum – Shifting Registered Office from One State to Another

# Shifting the Registered Office from One State to Another

A company can change most things about itself by a special resolution alone. Shifting the registered office across State boundaries is the major exception — it touches the jurisdiction of two different Registrars of Companies and potentially the interests of creditors, so Parliament has layered an extra approval on top of the SR.

## The two-tier approval mechanism

1. Special Resolution of members (the usual MOA-alteration gate).

2. Central Government approval – this power has been delegated to the Regional Director (RD). The application is made in the prescribed form.

## What the RD examines before approving

The RD must be satisfied that at least one of the following is true:

  • The alteration has the consent of creditors, debenture-holders and other persons concerned, or
  • The company has made sufficient provision for the due discharge of all its debts and obligations, or
  • Adequate security has been provided for such discharge.

> Logic: creditors of State A trusted the company sitting in State A. Once it moves to State B, they may find litigation costlier. The Act protects them.

## Timeline you must remember

StepTime-limit
RD must dispose of the application60 days from filing
Filing of certified copy of RD's order with ROC of each Statewithin prescribed time
ROC of new State issues fresh Certificate of Incorporationafter registration

## Filings with the Registrar (Sub-section 6)

For any alteration of MOA, the company must file with the ROC:

  • The special resolution under sub-section (1); and
  • The Central Government approval under sub-section (2) if the alteration changes the name of the company.

## The closing rule (Sub-section 11)

> No alteration has effect until it has been registered. Passing the SR is not enough; until the ROC enters it in the register, the change is legally inert.

## Special restriction for guarantee companies

In a company limited by guarantee not having share capital, any alteration of MOA that purports to give a non-member a right to share in the divisible profits is void. Only members can participate in divisible profits.

Worked example

### Example 1

Example – Creditor protection in action: ABC Ltd, registered in Maharashtra, wishes to shift its registered office to Karnataka. It owes ₹5 crore to a consortium of banks. The RD will not approve the shift unless ABC either (a) obtains a no-objection from the banks, or (b) shows that the loan has been fully repaid/refinanced, or (c) furnishes adequate security (e.g., a bank guarantee). Mere passing of a special resolution is insufficient.

⚠️ Common exam mistakes

  • Thinking a Special Resolution alone is enough — RD approval is also required for inter-state shifting.
  • Confusing the 60-day window: it is the time within which the RD must DISPOSE of the application, not the time within which the company must apply.
  • Forgetting that the alteration is inoperative until REGISTERED with the ROC, even after RD approval.
  • Believing CG/RD approval is needed even for shifting within the same State or same ROC jurisdiction — it is not.
  • In a guarantee company without share capital, drafting MOA so as to give outsiders a profit share — such a clause is void.
Bare-Act text Section 13(4)–(8) · The Companies Act, 2013 · click to expand
Section 13 (continued): (4) The alteration of the memorandum relating to the place of the registered office from one State to another shall not have any effect unless it is approved by the Central Government on an application in such form and manner as may be prescribed. (5) The Central Government shall dispose of the application under sub-section (4) within a period of sixty days and... shall, before passing its order, satisfy itself that the alteration has the consent of the creditors, debenture-holders and other persons concerned with the company or that the sufficient provision has been made by the company either for the due discharge of all its debts and obligations or that adequate security has been provided for such discharge.
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