See in view of amendment if companies act also the use of common seal is indispensable as the section 12 , 22, 46 and many other for different company related document execution there is mention of use of company seal.
Common seal of company
After companies amendment act 2015, common seal was omitted from section 9 of companies act 2013. If in AoA of company, it is mentioned that common seal is mandatory for all documents executed by company. Whether by way of resolution can a company by board resfolution resolve not to affix common seal in the documents executed by company, in view of companies amendment act 2015? If resolution is silent, on affixation of common seal and if there is a clause mandating affixation of common seal. Whether common seal needs to be affixed in view of companies amendment act 2015?
Asked 6 years ago in Business Law
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8 Answers
I didn't understand clearly what you meant. Requesting you to clarify little more.
Asked 6 years ago
See the use of company seal had been mandatory in above-mentioned section like for purpose of share certificate , power of attorney , executing other deeds. Therefore the use of company seal is necessary.
1) company can by special resolution resolve not to affix common self in all documents executed by company
2) common seal would be required to be affixed if there is clause mandating affixation of common zeal
Yes as per the amendment of 2015 the mandatory thing about common seal is made optional and directors signature is acceptable in lieu of the same
Dear Client,
Amendment will apply to companies incorporated under this Act or under any previous company law so even without board resolution, article can be amended. NO document missing company seal will held invalid executed after the amendment.
But requirement of making a common seal has now become optional so amendment in AOA is advisable.
Since the common seal was omitted from section 9 of the companies act by an amendment in the year 2015, even if there is a mandatory clause to affix common seal, due to this amendment it becomes superfluous or redundant.
Section 9 in The Companies Act, 1956
9. Act to override memorandum, articles, etc. Save as otherwise expressly provided in the Act-
(a) the provisions of this Act shall have effect notwithstanding anything to the contrary contained in the memorandum or articles of a company, or in any agreement executed by it, or in any resolution passed by the company in general meeting or by its Board of directors, whether the same be registered, executed or passed, as the case may be, before or after the commencement of this Act; and
(b) any provision contained in the memorandum, articles, agreement or resolution aforesaid shall, to the extent to which it is repugnant to the provisions of this Act, become or be void, as the case may be.
(a) the provisions of this Act shall have effect notwithstanding anything to the contrary contained in the memorandum or articles of a company, or in any agreement executed by it, or in any resolution passed by the company in general meeting or by its Board of directors, whether the same be registered, executed or passed, as the case may be, before or after the commencement of this Act; and
(b) any provision contained in the memorandum, articles, agreement or resolution aforesaid shall, to the extent to which it is repugnant to the provisions of this Act, become or be void, as the case may be.
it is necessary to affix common seal if there is clause in your articles of association to that effect