The Ministry of Corporate Affairs (“MCA”) vide notification dated July 22, 2021, bearing no. S.O. 2904(E) appointed September 1, 2021 as the date from which Section 4 of the Companies (Amendment) Act, 2020 (“Amendment Act”) would come into force.
As per Section 4 of the Amendment Act, on an application by a registered trademark owner, if the Central Government finds near resemblance between the company’s name and an existing trademark, it can direct to change the name, which direction would be required to be implemented by the company within 3 (three) months [instead of earlier 6 (six) months]. Further, instead of prescribing for fine and imprisonment, the Amending Act substitutes Section 16 (3) to provide that in case of failure of the company to change the name in accordance with Section 16 (1) of the Companies Act, 2013 (“the Act”), Central Government would allot a new name to the company which will be entered by the Registrar in the register of companies and the company will use such name thereafter. However, the Company is permitted to have the right to subsequently change its name.
The MCA vide another notification dated July 22, 2021, bearing no. G.S.R. 503(E) published the Companies (Incorporation) Fifth Amendment Rules, 2021 (“Amendment Rules”). The Amendment Rules, which will also come into force from September 1, 2021, has inserted. Rule 33A to the Companies (Incorporation) Rules, 2014 (“the Rules’) which provides as follows-
“33A. Allotment of a new name to the existing company under section 16(3) of the Act:
1. In case a company fails to change its name or new name, as the case may be, in accordance with the direction issued under sub-section (1) of section 16 of the Act within a period of three months from the date of issue of such direction, the letters “ORDNC” (which is an abbreviation of the words “Order of Regional Director Not Complied”), the year of passing of the direction, the serial number and the existing Corporate Identity Number (CIN) of the company shall become the new name of the company without any further act or deed by the company, and the Registrar shall accordingly make entry of the new name in the register of companies and issue a fresh certificate of incorporation in Form No.INC-11C:
Provided that nothing contained in sub-rule (1) shall apply in case e-form INC-24 filed by the company is pending for disposal at the expiry of three months from the date of issue of direction by Regional Director, unless the said e-form is subsequently rejected.
2. A company whose name has been changed under sub-rule (1) shall at once make necessary compliance with the provisions of section 12 of the Act and the statement, “Order of Regional Director Not Complied (under section 16 of the Companies Act, 2013)” shall be mentioned in brackets below the name of company, wherever its name is printed, affixed or engraved:
Provided that no such statement shall be required to be mentioned in case the company subsequently changes its name in accordance with the provisions of section 13 of the Act.”
A new Form No.INC-11C has also been inserted by the Amendment Rules pursuant to Rule 33A of the Rules.
Please find a copy of the Amendment Act here and a copy of the notification bearing no. S.O. 2904(E) here and a copy of the notification bearing no. G.S.R. 503(E) here.
This update has been contributed by Arka Majumdar (Partner) and Astha Singhania (Associate).
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