Page 222 - DMGT407Corporate and Business Laws

Unit 9: Memorandum of Association

9.1.4 Publication of Name (s.147) Notes

Every company shall:
(a) Paint or affix its name and the address of its registered office and keep the same painted or
affixed, on the outside of every office or place of business in a conspicuous position in
letters easily legible and in the language in general use in the locality.
The Department of Company Affairs has clarified that exhibition of its name in English
alone, without at the same time showing it in the local language will not be sufficient in
compliance with the requirements of the section.

The words ‘outside of every office’ do not mean outside the premises in which the office is
situated [Dr. H.L. Batliwala Sons & Co. Ltd. vs. Emperor (1941) 11 Comp. Cas. 154 (Bom)].
Where office is situated within a compound, the display outside the office room, though
inside the building, is sufficient.
(b) Have its name engraved in legible characters on its seal.
(c) Have its name and address of its registered office mentioned in legible characters in all
business letters, bill heads, negotiable instruments, invoices, receipts, etc.

!

Caution Penalty
If a company does not paint or affix its name and the address of its registered office in the
prescribed manner, the company and every officer of the company who is in default shall
be punishable with fine up to ` 500 per day till the default continues.
Also, every officer of a company or any person on its behalf who signs or authorises to be signed
on behalf of the company any bill of exchange, hundi, promissory note or cheque, etc., wherein
the name of the company is not mentioned in the prescribed manner, shall be personally liable
to the holder of such bill of exchange, hundi, promissory note, cheque, etc., for the amount
thereof unless it is paid by the company. The personal liability, however, will not be incurred
in the following cases:

1. The holder of a negotiable instrument, on which the company’s name has been incorrectly
stated, will not be able to enforce the personal liability under s.147(4) against the officer
concerned if the error was due to the holder’s own act [Durham Fancy Goods Ltd. vs.
Michael Jackson (Fancy Goods) Ltd. and Another (1968) 2 Q.B. 839].
2. The word ‘Limited’ is abbreviated to ‘Ltd.’ (P. Stacey & Co. vs. Wallis (1912) 28 T.L.R. 219.

3. There is an accidental omission of the word ‘limited’ [Dermatine Co. vs. Ashworth (1905)
21 T.L.R. 510]. In this case, a bill of exchange was accepted on behalf of a limited company.
The rubber stamp of the company was longer than the paper. As a result, the word ‘limited’
did not appear on the instrument.
Held: The directors who accepted the bill of exchange were not personally liable because omission
was neither deliberate nor of negligent origin. It was an obvious error of most trifling kind and
the mischief aimed at by the Act did not here exist.

The registered office clause [s.13(1) (b)]: This clause states the name of the State in which the
registered office of the company will be situated. Every company must have a registered office
which establishes its domicile and it is also the address at which company’s statutory books
must normally be kept and to which notices and all other communications can be sent. The
notice of the exact situation (address) of the registered office may be given to the registrar
within 30 days from the date of incorporation (s.146).

LOVELY PROFESSIONAL UNIVERSITY 215