Many a times when a Company is incorporated there are more than one industrial activity codes which seem to be applicable on the Company. This applicability is based on the objects clause of the Memorandum of Association (“MOA”) of the Company being incorporated.
While incorporating a Company there could be a possibility that an Industrial Activity Code which is selected is not best suited to the objects clause of the MOA of the Company.
Having a Company with wrong Industrial Activity Code can be misleading, for example let’s say the objects clause of a Company engaged in “Single Brand Retail Trading” may contain manufacturing as one of the objects of the MOA. Accordingly based on the same object clause, the Industrial Activity Code is selected as Manufacturing whereas in this case Trading is more relevant.
A common question is how to rectify the same if need be.
The aforesaid anomaly can be rectified at the time of changing the MOA of the Company by following the procedure as prescribed under the Companies Act, 2013. While doing so, the revised Memorandum of Association is required to be filed with Registrar of Companies along with the shareholder’s resolution in e-form MGT-14.
There is an option in form MGT-14 wherein the user needs to specify if due to change in the objects clause there is a change in Industrial Activity Code.
This particular option can be used to change the Industrial Activity Code of the Company at the time of changing the MOA of the Company
Note: A company cannot file form MGT 14 for the aforesaid purpose till it has filed form 20A i.e. declaration of commencement of business.
This Article is based on personal views of the writer and shall not be treated as professional advice. The writer of this Article can be reached out at priancakhatri@gmail.com
CS Priyanka Khatri 