By a notification dated May 10, 2019, the Ministry of Corporate Affairs has notified the Companies (Incorporation) Fifth Amendment Rules, 2019 (“Amendment Rules”) to amend the Companies (Incorporation) Rules, 2014 (“Principal Rules”).
Rule 8 (Undesirable names) of the Principal Rules has been substituted by the Amendment Rules with the following rules:
A proposed name shall be deemed to resemble too nearly with the name of an existing company, if, by disregarding the following matters, the two names are the same:
(a) words like Private, Pvt, Pvt., (P), OPC Pvt. Ltd., IFSC Limited, IFSC Pvt. Limited, Producer Limited, Limited, Unlimited, Ltd, Ltd., LLP, Limited Liability Partnership, company, and company, & co, & co., co., co, corporation, corp, corpn, corp or group;
(b) plural or singular form of words in one or both names;
(c) type and case of letters, spacing between letters, punctuation marks and special characters used in one or both names;
(d) use of different tenses in one or both names;
(e) use of different phonetic spellings including use of misspelled words of an expression;
(f) use of host name such as ‘www' or a domain extension such as ‘net', ‘org', 'dot' or 'com' in one or both names;
(g) the order of words in the names;
(h) use of the definite or indefinite article in one or both names;
(i) a slight variation in the spelling of the two names including a grammatical variation thereof;
(j) complete translation or transliteration, and not part thereof, of an existing name, in Hindi or in English;
(k) addition of the name of a place to an existing name, which does not contain the name of any place;
(l) addition, deletion, or modification of numerals or expressions denoting numerals in an existing name, unless the numeral represents any brand.
However, clauses (f) to (h) and clauses (k) and (l) shall not be disregarded while comparing the names, if a no objection by way of a board resolution has been provided by an existing company.
The proposed name shall be considered undesirable, inter alia, for the following reasons:
(a) It is prohibited under the Emblems and Names (Prevention and Improper Use) Act, 1950;
(b) It includes a registered trade mark;
(c) It is identical with or too nearly resembles the name of a limited liability partnership or a name which has been reserved under rule 9;
(d) The company's main business is financing, leasing, chit fund, investments, securities or combination thereof, but the proposed name is not indicative of such related financial activities, viz., chit fund or investment or loan, etc. or vice versa;
(e) Any part of the proposed name includes the words indicative of a separate type of business constitution or legal person or any connotation thereof;
(f) It is identical to the name of a company dissolved as a result of liquidation proceeding and a period of two years has not elapsed from the date of such dissolution.
Prior approval of the Central Government would be required for use of, inter alia, the following terms in the name of a company in English or any other language depicting the same:
(a) Board;
(b) Commission;
(c) Authority;
(d) Undertaking;
(e) Small Scale Industries;
(f) Khadi and Village Industries Corporation;
(g) Financial Corporation and the like;
(h) Forest corporation;
(i) Development Scheme.
The Amendment Rules have come into force on the date of their publication in the Official Gazette.
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