Legal Framework
Shifting the registered office of a company from one state to another is a significant corporate action under Indian Company Law. According to Section 12(5) of the Companies Act, 2013, a company intending to move its registered office from one state to another must obtain the approval of the Central Government. This ensures that the change is legally recognized and that all regulatory obligations, including taxation and jurisdictional compliance, are properly addressed. The process safeguards the interests of shareholders, creditors, and other stakeholders by preventing any arbitrary relocation that could affect the company’s operations.
Procedure to Shift Registered Office
The procedure begins with a Board Resolution approving the shift of the registered office. Subsequently, the company must pass a Special Resolution in a general meeting of its members, notifying the Registrar of Companies (RoC) of its intent. Along with the application, supporting documents such as the new address, justification for relocation, and consent letters from creditors (if any) must be filed with the RoC. The Central Government then reviews the application and issues a no-objection certificate, after which the company can officially record the new registered office in its statutory records.
Post-Approval Compliance
Post-approval, the company must update all statutory records to reflect the new state jurisdiction. This includes updating the Memorandum of Association (MoA), filing Form INC-23 with the RoC, notifying tax authorities, banks, and other regulatory bodies. Any contracts, licenses, or agreements tied to the previous registered office must also be amended. Failure to comply with these statutory requirements can attract penalties under the Companies Act, 2013, and may affect the legal validity of company actions carried out before compliance.
Real-Time Example
For instance, a tech company originally registered in Bangalore, Karnataka decided to shift its registered office to Hyderabad, Telangana due to strategic business expansion. The company passed a special resolution, filed Form INC-23 with the RoC, obtained Central Government approval, and updated all licenses and bank accounts. The move facilitated better access to skilled talent and improved market reach while remaining fully compliant with legal procedures.
Mnemonic to Remember
“Board, Special, Central, Update” — BSCU. This represents the four key steps: Board Resolution, Special Resolution, Central Government Approval, and Updating statutory records. By remembering BSCU, one can easily recall the correct process for shifting a registered office between states.
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