Business Laws and Ethics · Company Types, Promotion, Formation and Related Procedures

Memorandum and Articles of Association: Alteration and Doctrines

Updated 10 October 2026 · Fact-checked

The memorandum is a company's charter that sets its name, registered office State, objects, liability and capital. The articles are its internal rules of management. Both bind the company and members. To solve questions, identify the document, the alteration procedure (special resolution, plus approval where needed), and which doctrine applies.

Understand Memorandum and Articles of Association

Every company has two key constitutional documents. The memorandum of association is the charter. It defines the company's identity and the limits of its powers: its name, the State of its registered office, its objects, the liability of members and its share capital. It tells outsiders what the company can do.

The articles of association are the internal rules. They govern how the company is run: meetings, directors, voting, share transfers and similar matters. The articles are subordinate to the memorandum and to the Act. If an article conflicts with the memorandum or the Act, the article is void to that extent.

Both documents are registered and become public. This leads to constructive notice: anyone dealing with a company is presumed to have read the registered memorandum and articles, and to know their contents. You cannot say later that you did not know a limit on the company's powers or an officer's authority.

The doctrine of ultra vires says an act beyond the objects in the memorandum is void. It cannot be ratified even by all members, because the company has no capacity to do it. An act within the company's powers but outside the directors' authority under the articles is different. It is irregular, and members can usually ratify it.

The doctrine of indoor management protects outsiders. They may assume the company's internal procedures were followed, such as a resolution being passed properly. It softens constructive notice: outsiders must know the public documents, but need not investigate internal compliance. This protection is lost in certain situations, listed below.

Key rules to remember

Alteration of articles (Section 14): Special resolution + filing with Registrar within 15 days, with a printed copy of the altered articles; Alteration must be subject to the Act and the memorandum. Once registered, the alteration is valid as if originally in the articles.
Private to public conversion: Special resolution to alter articles (Section 14(1)(a)); If a private company's articles no longer contain the required private-company restrictions, it ceases to be private from the date of alteration.
Public to private conversion: Special resolution + approval by order of the Central Government; Under the second proviso to Section 14(1), such an alteration is not valid unless approved by the Central Government.
Alteration of memorandum (Section 13(1)): Special resolution + the procedure in Section 13, save as provided in Section 61; No alteration has effect until registered (Section 13(10)).
Change of name (Section 13(2)): Special resolution + written approval of the Central Government; No approval is needed if the only change is adding or deleting the word "Private" on conversion. The change is effective only on the fresh certificate of incorporation (Section 13(3)).
Registered office to another State (Section 13(4)-(5)): Special resolution + Central Government approval; The Central Government disposes of the application within 60 days. It may check the consent of creditors or adequate provision for debts.
Change of objects after a prospectus (Section 13(8)): Special resolution + newspaper publication (one English, one vernacular) + website notice with justification + exit opportunity for dissenting shareholders; Applies only if money raised through a prospectus is still unutilised.
Share capital alterations (Section 61(1)): If authorised by articles, alter memorandum in general meeting to: increase authorised capital; consolidate; convert into stock; sub-divide; cancel unissued shares; Cancelling unissued shares is not a reduction of capital (Section 61(2)). Consolidation changing voting percentages needs Tribunal approval.
Noting alterations (Section 15): Every alteration to be noted in every copy; penalty ₹1,000 per copy issued without it; The company and every officer in default are liable.
Ultra vires vs irregular: Beyond memorandum = void, cannot be ratified. Beyond articles but within memorandum = can be ratified; Use this test first in any problem.

How to solve Memorandum and Articles of Association questions

Use this sequence for any question on the memorandum, the articles or the related doctrines.

1Identify which document is involved: memorandum (name, office, objects, liability, capital) or articles (internal management).
2If the question is about alteration, name the section: Section 14 for articles, Section 13 for memorandum, Section 61 for share capital.
3State the required resolution (special resolution in most cases) and any extra approval: Central Government for name, change of State, or public-to-private conversion.
4State the filing and effect: filing with the Registrar, and when the alteration takes effect (registration or fresh certificate).
5If a third party is involved, test the act. Is it beyond the objects (ultra vires, void)? Or only a defect in internal procedure (indoor management)?
6Apply constructive notice: the outsider is presumed to know the public documents. Then check whether any indoor management exception removes the outsider's protection.
7Write a one-line conclusion that names the legal result: valid, void, ratifiable, or binding on the company.

Quickest way: Three-question filter

When to use it: Use for MCQs and short case problems where time is tight.

Question 1: Is the act within the objects clause? If no, it is ultra vires and void, and ratification does not help.
Question 2: If yes, is there an internal procedural defect? If the outsider acted in good faith without notice of it, indoor management protects the outsider.
Question 3: Was the outsider put on inquiry, or was a document forged or was he aware of the irregularity? If yes, the protection is lost.
For alteration MCQs, think: articles = special resolution; name or change of State = special resolution plus Central Government; public to private = Central Government order.

Common mistakes in Memorandum and Articles of Association

Saying an ultra vires act can be ratified by all members.
Students mix it up with acts beyond the directors' authority, which can be ratified.
Fix: Ask whether the act is beyond the memorandum's objects. If so, it is void and cannot be ratified.
Stating that every alteration of the articles needs Central Government approval.
Students over-generalise from the conversion rule.
Fix: A special resolution is the general rule. Central Government approval is needed only for public-to-private conversion by alteration of articles.
Forgetting that a company's memorandum alteration is effective only on registration.
Students stop at the resolution.
Fix: Add that no alteration under Section 13 has effect until registered, and a change of name is complete only on the fresh certificate.
Claiming indoor management protects an outsider in every case.
Students remember the doctrine but not its limits.
Fix: List the exceptions: knowledge of the irregularity, suspicious circumstances that call for inquiry, forgery, and acts the outsider could have verified from the public documents.
Confusing the contents of the two documents and writing the difference as only 'one is more important'.
Answers are given in general terms.
Fix: Compare on points: purpose, contents, relation to the Act, ultra vires effect, and alteration procedure.
Treating cancellation of unissued shares as a reduction of capital.
Both reduce the capital figure.
Fix: Section 61(2) says cancellation of shares not taken or agreed to be taken is not a reduction of share capital.

Worked examples

Example 1

Sunrise Textiles Ltd, a public company, wants to alter its articles to change the quorum for board meetings. A shareholder asks what procedure is needed and what must be filed. Advise.

Show the solution

The change relates to internal management, so it is an alteration of articles under Section 14.
Section 14(1) allows a company to alter its articles by special resolution, subject to the Act and the conditions in its memorandum.
The alteration does not convert a public company into a private company, so no Central Government order is needed.
Under Section 14(2), the alteration must be filed with the Registrar within fifteen days, together with a printed copy of the altered articles.
Once registered, Section 14(3) makes the alteration valid as if it were originally in the articles.
Under Section 15, the alteration must be noted in every copy of the articles, or the company and officers in default face a penalty of ₹1,000 for every copy issued without it.

Answer: A special resolution is enough. File the alteration with the Registrar within 15 days with a printed copy of the altered articles. After registration it is valid as if originally in the articles, and every copy must be noted.

Example 2

The objects clause of Kaveri Agro Ltd covers only the manufacture of fertilisers. The directors, with the unanimous approval of all members, enter into a contract with Mr Rao to run a hotel. The company refuses to pay. Can Mr Rao enforce the contract?

Show the solution

Running a hotel is outside the objects in the memorandum, so the act is ultra vires the company.
An ultra vires act is void because the company has no capacity to do it.
Unanimous approval of members cannot ratify it, because members cannot give the company a power that its memorandum does not grant.
Under constructive notice, Mr Rao is presumed to know the objects clause, since it is a registered public document. He cannot claim he was unaware.
Indoor management does not help him. That doctrine covers internal irregularities, not an act beyond the company's objects.
The company can lawfully extend its objects only by altering the memorandum under Section 13, using a special resolution, and the alteration takes effect only on registration.

Answer: No. The contract is ultra vires and void. Member approval cannot ratify it, and neither constructive notice nor indoor management protects Mr Rao. The company would need to alter its objects under Section 13 first.

Exam tips

For a 'distinguish between' question, write 5 to 6 points in two columns: purpose, contents, subordination, ultra vires effect, alteration and legal status.
In case problems, always state the doctrine by name, the rule in one line, and then apply it to the facts. This earns step marks.
Learn the alteration table by heart: articles, name, State of registered office, objects after prospectus and share capital. MCQs often test which approval is required.
Do not name a case or section unless you are certain. Explain the rule in plain words instead.
For MCQs on doctrines, first decide whether the defect is in the memorandum (void) or in internal procedure (outsider protected).

Practice questions from Company Types, Promotion, Formation and Related Procedures

Memorandum and Articles of Association in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Memorandum and Articles of Association: frequently asked questions

What is the main difference between the memorandum and articles of association?

The memorandum sets out the company's constitution and the scope of its powers, including name, State of registered office, objects, liability and capital. The articles contain the rules for internal management. The articles are subordinate to the memorandum and the Act.

How can a company alter its articles under the Companies Act, 2013?

Under Section 14, it passes a special resolution, subject to the Act and its memorandum. The alteration is filed with the Registrar within fifteen days with a printed copy of the altered articles. Converting a public company into a private company also needs Central Government approval.

What are the exceptions to the doctrine of indoor management?

The outsider cannot rely on it if he knew of the irregularity, if the circumstances were suspicious enough to require inquiry, or if the document relied on was forged. It also does not cover acts that the public documents themselves show to be unauthorised.

What is the difference between ultra vires and constructive notice?

Ultra vires concerns the company's capacity: an act beyond the objects clause is void. Constructive notice concerns outsiders' knowledge: they are presumed to know the contents of the registered memorandum and articles. Together they mean an outsider cannot enforce an act that the public documents show to be beyond the company's powers.