Memorandum of

Association

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Memorandum of Association

• First step in the formation of a company.• Constitution of the company.• Defines limitations of the powers of a

company.

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Clauses of MOA

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MEMORANDUM OF ASSOCIATIONOF

RELIANCE INDUSTRIES LIMITEDName of the company

RELIANCE INDUSTRIES LIMITED

Registered Office Maharashtra

Object To carry on the business of man made fibre products of all kinds.(For detail see next slide )

Liability Liability of members is limited

Capital 500,00,00,000 * 10 ( 500 crores equity share of rs. 10 each) 100,00,00,000 * 10 ( 100 crores equity share of rs. 10 each)-------------------------------------------------------------------------------600,00,00,000 * 10 = 60,00,00,00,000 (Rs. Six thousand croroes only )

Associations

(for details www.ril.com/downloads/pdf/MOA.pdf )

There were 7 subscribers who initially hold the equity shares of the company. For e.g.

Sr. No Name Address No. of equity share

Witness

1 M.D. SHIVNANJAPPA

36, Cunningham Road, Bangalore - 18

500 C.V. SRINIVASA MURTHY

OBJECTS1. To carry on the business of all kinds of man made fibres by any process using

petrochemicals of all description or by using vegetable or mineral oils.2. To carry on the business of manufacturers, dealers etc. of all types of petro-chemicals

like Naphta, Methane, Ethylene, Propylene, Butenes, Naphthalene etc. all other petrochemical products and polymers in all their forms like resins, fibres, sheets mouldings, castings etc.

3. To carry on the business of manufacturing, buying, selling, exchanging, converting, Altering etc or using or advising users in the proper use of, cotton yarn, pure silk yarn and such other fibre, fibres and fibrous materials, or allied products, by-products, substances or substitutes for all or any of them, or yarn or yarns, for textile or other use, as may be practicable.

4. To manufacture or help in the manufacturing of any spare parts, accessories, or anything or things required and necessary for the above mentioned business.

NOTE : There are other objects incidental or ancillary to the attainment of main object. For complete understanding kindly visit www.ril.com/downloads/pdf/MOA.pdf

ALTERATION OF THE MEMORANDUM

Alteration OfName Clause

Alteration Of Registered office clause

Alteration Of Object clause

AlterationOfLiability clause

Alteration OfCapital clause

• Alteration of name clause : By passing a “Special resolution” and with the approval of Central govt. in writing.

• Alteration of registered office : By passing a Board’s resolution and notifying the registrar within 30 days.

• Alteration of Object clause : Object clause can be altered under some predefined circumstances.

• Alteration of liability clause : By adding a new “liability clause” in case of changing liability from unlimited to limited.

• Alteration of capital clause : By passing an ordinary resolution,

provided it is authorized by article to do so.

Doctrine of Ultra Vires

• Ultra means ‘beyond’• Vires means ‘the powers’• Ultra Vires means ‘beyond the powers’.• Its implication.• Rationale Behind Doctrine? artificial person- no intelligence Protect Shareholder interest.

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Effects of Ultra Vires• Personal Liability of Directors on the basis of fact not law • Ultra Vires acquired property Company’s property Secure• Ultra vires contracts Claim by third party void(example)• Ultra vires lending Borrower can be sued to recover money• Ultra vires torts Company not liable outside ambit of object. 10

Thank You

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