Naming a business which is free from the issues and the resemblance of an existing company is all we wanted while incorporate a new business. Hereby, i have listed out some of the rules you should keep in your mind while naming a business.
Criteria to determine whether proposed name is identical with name of existing company:
In determining whether a proposed name is identical with another, the differences on account of the following shall be disregarded-
- The words like private, Pvt, (P), Limited, Ltd, Ltd., LLP, Limited Liability Partnership;
- Words appearing at the end of the names – Company, and company, co., co, corporation, corp, corpn, corp.;
- Type and case of letters, spacing between the letters and punctuation marks;
- Plural version of any of the words appearing in the name;
- Joining words together or separating the words doesn’t make a name distinguishable from a name that uses the similar, separated or joined words;
- Use of a different tense or number of the same word does not distinguish one name from another;
- Using different phonetic spellings or spelling variations shall not be considered as distinguishing one name from another.
- For example, an existing company with a name S.P. Industries limited, then the possibilities of new company names like S&P industries or Es Pee industries or S n P industries would not be allowed and similarly if a name contains a numeric character like 3, resemblance will also be checked;
- When comes to misspelled words, it may intentionally misspelled or not, do not conflict with the similar and properly spelled words;
- The internet related designation such as .com, .gov, .net, .org, .in, .edu would not make a name distinguishable from another so that even (.) have to be written as dot;
- The words like New, Shri, Nav, Modern, Sri, Sree, Jai, Om, The, etc., doesn’t make a name distinguishable from the existing name and
- If it is different from the name of existing company only to the extent of adding the name of the place, the same would not be allowed;
- Such a kind of names may be allowed only if no objection from the existing company by the way of board resolution to be submitted;
- The same words with different combinations don’t make a name distinguishable from an existing name. For e.g., if an existing company with the name of “Constructors and Designers Limited”, the name “Designers and Constructors” would not be allowed unless it is a change of the name of an existing company;
- If the proposed name is the Hindi or English translation or transliteration of the name of an existing company or limited liability partnership in English or Hindi, as the case may be.
Undesirable names for your business:
The name shall be considered undesirable, if
- It attracts the provisions of section 3 of the Emblems and Names (Prevention and Improper Use) Act, 1950 (12 of 1950);
- It includes the name of a registered trademark or a trademark which is subject of an application for registration, unless the consent of the owner or applicant for registration, of the trademark, as the case may be, has been obtained and produced by the promoters;
- It includes any word or words which are offensive to any section of the people;
The name shall also be considered undesirable, if
- The proposed name is identical with or too nearly resembles the name of a limited liability partnership;
- It is not compatible with the principal objects of the company which sets out in the memorandum of association. There is no need that every name should be an indicative of the objects of the company, but if there is some indication of objects in the name, then it shall be in conformity with the objects which have been mentioned in the memorandum;
- The company’s main business is financing, chit fund, leasing, investments, securities or combination thereof, such name shall not be allowed unless the name is indicative of such related financial activities, viz, chit fund or investment or loan, etc.,;
- It resembles closely the popular or abbreviated description of an existing company or limited liability partnership;
- The name which is to be proposed is so identical with or too nearly resembling the name of the company or LLP which is incorporated outside India and reserved by such company or LLP with the registrar. If a foreign company which is incorporating its subsidiary company in India, then the original name of the holding company as it may be allowed with the addition of word “India” or name of any Indian state or city, if otherwise available;
- The proposed name which includes the words indicates a legal person or a separate type of business constitution or any connotation thereof e.g., Trust, Partnership, Society, Firm, Proprietor, co-operative, HUF, PTE, Sdn, PLC, INC, SA etc.
- The name including phrase “Electoral Trust” may be allowed for registration of companies to be formed under section 8 of the act.
Words which can be used in name only with previous approval of central Government:
Here, some of the words have listed out. The words and combinations from the following words should not be used in the name of the company in English and any of the languages which depicts the same meaning unless obtained the previous approval from the central government for using such word or expression:
- Small Scale Industries;
- Khadi and village industries corporation;
- Judiciary or court;
- Statute or statutory;
- Development scheme;
- Financial, corporation and the like;
- Development Authority;
- Prime Minister or Chief Minister;
- Forest corporation;
- The word scheme use with the name of India, State, Government, Bharat or any other government authority or resembling in any other manner with the schemes been launched by Central, state or local government and authority;
Words to be used in the name of section 8 companies/Nidhis:
Under section 8 of the companies act, the name includes the words such as association, forum, chambers, foundation, federation, electoral trust, confederation, council and the like etc.
The company which is incorporated as a “Nidhi” should have the last words “Nidhi limited” as a part of its name.
Use of name released from database on change of name:
The names which has been released on change of name by any company remains in the database and would not be allowed to be taken by any other company including the group of the company who has changed the name for a period of three years from the date of change subject to specific direction from the competent authority in the course of arrangement, compromise and amalgamation.
Reservation of name (rule 9):
For the reservation of name, the application Form. No. INC1 has to be made along with the fee as provided in the companies.
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