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Microlesson · 5-min read

Other Provisions related to MOA & AOA [Sections 6, 10, 15, 17, 18]

# Other Provisions related to MOA & AOA

## Effect of Registration of MOA & AOA [Section 10]

  • Once registered, MOA & AOA become legally binding on the company and its members.
  • However, MOA/AOA cannot bind the company or members to an outsider to give effect to AOA provisions.
  • All monies payable by a member to the company under MOA/AOA is a debt due from him to the company.

## Act to Override MOA, AOA, etc. [Section 6]

  • Provisions of the Companies Act have overriding effect over MOA, AOA, agreements, or resolutions.
  • Any provision in MOA/AOA, agreement, or resolution that conflicts with the Act is void.
  • Exception: If a section of the Act itself says that MOA/AOA/agreement/resolution will prevail, then those will prevail.

## Copies of MOA, AOA, etc. to be given to Members [Section 17]

  • Company must send a copy of MOA, AOA, agreements, and resolutions (which are not included in MOA & AOA) to a member within 7 days of request.
  • Default penalty: Company and officer in default — fine of ₹ 1,000 per day during which default continues, subject to a maximum of ₹ 1 lakh.

## Alteration of MOA/AOA to be Noted in Every Copy [Section 15]

  • Every alteration in MOA & AOA shall be noted in every copy of MOA/AOA issued thereafter.
  • Default penalty: Company and officer in default — fine of ₹ 1,000 for every copy issued without the alteration.

## Conversion of Companies Already Registered [Section 18]

Procedure:

1. Alter MOA & AOA as per the relevant provisions for the new class.

2. File application with ROC for conversion / alteration.

3. ROC shall:

  • Close the former registration of the company, AND
  • Issue a fresh Certificate of Incorporation (after registering required documents).

Key safeguard: Registration as a different class shall not affect liabilities, obligations, or contracts of the company that existed before conversion.

Worked example

### Example 1

Q: A member of XYZ Ltd. requests a copy of the MOA on 1st June 2026. The company sends it on 25th June 2026. What is the penalty?

A: The company should have sent the copy within 7 days (by 8th June). It is delayed by 17 days (9th–25th June). Penalty = ₹1,000 × 17 = ₹17,000 each on the company and every officer in default, subject to a cap of ₹1 lakh per default.

### Example 2

Q: ABC Ltd. (a One Person Company) converts into a private company. Are its earlier contracts and liabilities affected?

A: No. As per Section 18, conversion does not affect any liabilities, obligations, or contracts of the company that existed before conversion. The new company continues to be liable on all old contracts.

### Example 3

Q: AOA of a company contains a clause that conflicts with a mandatory provision of the Companies Act, 2013. What is the effect?

A: Under Section 6, the Act has overriding effect. The conflicting AOA clause is void. (Unless the Act itself states that AOA shall prevail in that matter.)

⚠️ Common exam mistakes

  • Forgetting the maximum cap of ₹1 lakh for the per-day penalty under Section 17.
  • Saying that conversion under Section 18 extinguishes old liabilities — it does not.
  • Confusing Section 6 (Act overrides MOA/AOA) with the conflict rule between MOA and AOA themselves (where MOA prevails).
  • Believing that AOA binds outsiders — it binds only the company and members inter se.
Bare-Act text Section 10 · Companies Act, 2013 · click to expand
The memorandum and articles shall, when registered, bind the company and the members thereof to the same extent as if they respectively had been signed by the company and by each member. All money payable by any member to the company under the memorandum or articles shall be a debt due from him to the company.
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