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Microlesson · 5-min read

Name Clause in MOA – Suffixes, Restrictions, Reservation, Cancellation

# Name Clause of MOA

## 1. Suffix Requirements

Company TypeName must end with
Public Company'Limited'
Private Company'Private Limited'
Section 8 CompanyNo suffix (exempted)
IFSC Company'International Financial Service Company' or 'IFSC'

## 2. Restrictions – When a name is NOT permitted

A name shall not be:

  • Identical to or too nearly resembling an existing company's name, AND
  • Undesirable in the opinion of the Central Government.

### Undesirable Names – CG approval required

Names suggesting association with CG/SG or local authority; prohibited words like Board, Authority, National, President, SSI.

### Special Entity Names – Regulator declarations needed

Terms like Insurance, Bank, Stock Exchange require declarations of compliance with IRDAI, RBI, SEBI, MCA.

## 3. 'Too Nearly Resembling' – The Rules of Resemblance

A name is considered to resemble another if it differs only by:

1. Plural/singular form

2. Type/case of letters, spacing, punctuation

3. Different tense

4. Slight spelling variation

5. Different phonetic spelling

6. Complete translation/transliteration

7. Use of host name

8. Order of words

9. Definite/indefinite article

10. Addition of a place name to an existing name

11. Addition/deletion/modification of numerals (unless numeral itself is a brand)

## 4. Reservation of Name (RUN System)

Use CaseReservation Period
New company20 days
Change of name of existing company60 days

### Extension under Rule 9A (file BEFORE expiry)

ExtensionFee
Additional 20 days₹1,000
Additional 40 days₹3,000

## 5. Cancellation of Name Obtained by Wrong Information

StageConsequence
Company NOT yet incorporatedName cancelled; applicant fined up to ₹1 lakh
Company already incorporatedAfter hearing, ROC may direct: (a) change of name within 3 months, OR (b) striking off, OR (c) petition for winding up

## 6. Emblems and Names Act Compliance

Names must comply with the Emblems and Names (Prevention of Improper Use) Act, 1950.

Worked example

### Example 1

Q. XYZ Pvt Ltd was incorporated using a name obtained with false information. What action can the ROC take?

A. Since the company is already incorporated, the ROC must give an opportunity of being heard, and may direct any of: (i) change of name within 3 months, (ii) striking off, or (iii) file a petition for winding up.

### Example 2

Q. A promoter reserves 'SkyTech Innovations Ltd.' on 1st March for a new company. By when must incorporation happen, and can the reservation be extended?

A. Initial reservation is 20 days, so incorporation must happen by 21st March. Under Rule 9A, the promoter may, before expiry, seek extension of 20 days for ₹1,000, or 40 days for ₹3,000.

### Example 3

Q. Is 'The Sky Builders Pvt. Ltd.' too nearly resembling 'Sky Builder Ltd.'?

A. Yes. It differs only by plural ('Builders'), definite article ('The'), and the suffix. Resemblance rules treat these as immaterial. Approval will not be granted.

⚠️ Common exam mistakes

  • Confusing the 20-day (new) vs 60-day (existing) reservation periods.
  • Believing addition of 'Pvt./Ltd.' or 'The' makes a name distinct — these are immaterial.
  • Forgetting that Section 8 companies do NOT use 'Limited' / 'Private Limited'.
  • Stating the ROC can directly strike off without hearing — hearing is mandatory.
  • Confusing penalties: pre-incorporation = fine up to ₹1 lakh; post-incorporation = name change/strike off/winding up.
Bare-Act text Section 4(2), 4(3), 4(4), 4(5) · Companies Act, 2013 · click to expand
Sec. 4(2): The name stated in the memorandum shall not — (a) be identical with or resemble too nearly to the name of an existing company; or (b) be such that its use by the company — (i) will constitute an offence under any law; or (ii) is undesirable in the opinion of the Central Government. Sec. 4(4): A person may make an application... to the Registrar for the reservation of a name. Sec. 4(5): the Registrar may... reserve the name for twenty days from the date of approval; in case of an existing company, name shall be reserved for sixty days.
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