Memorandum of Association

The Memorandum of Association is the most important document of the company. It is it’s which contains the fundamental condition upon which alone the company can be incorporated. It defined the limitation of the powers of the company, the area beyond which the actions of the company cannot go. Its purpose is to enable shareholders and creditors and those who deal with the company to know what its permitted range of enterprise and powers is. The memorandum of a company limited by shares must contain the followings particulars or clauses:

1.      The name of the company with the “Limited” as the last word of its name in the case of a public company and the words “private Limited” as the last words of the name in case of a private company.

2.      Every company must have a registered office. But it is enough to mention in the memorandum the name of the state I which the registered office is to be situated.

3.      The statement of the objects in the memorandum is of supreme importance, as it indicates the sphere of its activities and the extent of its powers. The main object and other “object” must distinctly and separately be started in the memorandum.

4.  A declaration that the liability of the shareholders is limited to amount unpaid on their respective share must be made in the memorandum.

5.   The capital clause must contain a statement as to the amount of capital with which it is proposed to register the company and the division thereof into shares a certain fixed amount.

6.    The subscription clause precedes the names of the signatories to the memorandum and reads something like this: we, the several persons whose names occupations and addresses are subscribed are desirous of being formed in to a company in pursuance of the Memorandum of Association and we respectively agree to take the number of shares in the capital of the company set opposite our respective names.