Compliance Requirements for Changing Object Clause of a Company

• Where the company has raised money from public through prospectus and has any unutilised amount out of the money so raised, it shall not change the objects for which the money so raised is to be applied unless a special resolution is passed through postal ballot and the notice in respect of the resolution for altering the objects shall contain the particulars as specified under Rule 32 of the Companies (Incorporation) Rules, 2014. 
• The advertisement in the newspaper (one in English and one in vernacular language which is in circulation at the place where the registered office of the company is situated) giving details of each resolution to be passed for change in objects which shall be published simultaneously with the dispatch of postal ballot notices to shareholders. 
• The notice shall also be placed on the website of the company, if any. 
• The dissenting shareholders shall be given an opportunity to exit by the promoters and shareholders having control in accordance with regulations to be specified by the SEBI
• Board meeting to be conducted in accordance with Section 173 of the Companies Act.
• Shareholder’s approval is required and can be taken through passing resolution either in General meeting or by postal ballot. 
• As per Section 110 of the Companies Act, 2013 read with Rule 22(16) of the Companies (Management and Administrative Rules), 2014), the object clause of a company shall be altered by way of postal ballot only in case of companies other than OPC and companies having members up to 200. 
• Such items of business required to be transacted by means of postal ballot may also be transacted at a general meeting by a company which is required to provide the facility to members to vote by electronic means under section 108, in the manner provided in that section. (Proviso of Section 110(1) of the Companies Act, 2013) n
• Under Section 108 of the Companies Act 2013, the Central Government prescribes the class or classes of companies and manner in which a member may exercise his right to vote by electronic means. Classes of company so prescribed are – company which has listed its equity shares on a recognized stock exchange and every company having not less than one thousand members [Rule 20(2) of The Companies (Management and Administration) Rules, 2014] 
• Therefore, a listed company and a company having not less than 1000 members providing e-voting facilities may opt for alteration of object clause at a general meeting or by way of postal ballot (Section 108 read with Rule 20 of the Companies [Management and Administrative Rules], 2014.) 

For more details on conducting business by way of Postal Ballot, one must refer to Rule 22 of the Companies [Management and Administrative Rules], 2014.) which provides for the procedure to be followed for conducting business through Postal Ballot.

• Company shall file the form MGT-14 with ROC within 30 days of passing of Special Resolution along with the fees as specified and with the following attachments:

• • CTC of special resolution passed in the GM along with Explanatory Statement
  • Notice of GM
  • Consent for shorter Notice where the meeting is convened at shorter Notice
  • Altered copy of MOA & AOA, etc

• Registrar of the company shall register the new objects of the company and shall also certify the registration within 30 days from the date of filing of special resolution by the company. 

• The alteration of object clause shall be noted in every copy of MOA of the company.