Memorandum of Association : Meaning, Features, Importance and Content of Memorandum

In this article we will discuss about  memorandum of association which  is the one of the most important document required by company  for formation  and registration with registrar , also defines the scope of activities of the company and contains the condition upon which the company is formed.

Meaning and Definition of Memorandum of Association :

Memorandum is the document of the company which contain all the information regarding company and also known as company foundation . It contains name, registered office, objects and company capital as well as limit of liabilities of the members of the company.It is signed by the company members and required for registration of company to its registrar.

According to Lord Justice Cairns,“ The memorandum of association of a company is its charter and defines the limitations of the company established under the Act.

According to Justice Charlesworth, Memorandum is the company charter and defines the limitations of powers of the company.”

Lord Justice Bowen states that,“ the memorandum of association of a company contains fundamental conditions upon which alone the company is allowed to be incorporated.”

Thus, a memorandum is a fundamental document of a company  which contains information about the company  including name ,place of registered office,objects , liability of company members and capital of company.It contain name,signatures and other particulars of the persons of company members.

Characteristics / Features :

The main features of memorandum of association are discuss below –

  1. It is a fundamental document  of a company.
  2. It is essential to every company to prepare its own memorandum.
  3. It should be in written form.
  4. It contains Name, signature and other particulars of persons.
  5. On registration of memorandum , the company is deemed to have been registered.
  6. It contains information regarding company information.
  7. Memorandum is a public document after registration and inspected by any person.
  8. It is a binding of company and its members.

Importance of Memorandum of Association :

The Memorandum of association is important document of an organisation  , and it is very significant and vital document of every company.It is not only important for company also important for shareholders , creditors  and every person who deals with company.The importance of memorandum are discuss below :-

  1. Basis for the company –  Memorandum of association is the  basic document of company  and company cant get registered without it.
  2. Determines company scope –  It lay down the scope of company activities which they perform and company cannot go beyond that. 
  3. Source of company’s Power –  Memorandum of association also defines the  the company powers and help company members in workings.
  4. Guide to directors – It serves as a guide to the  directors of the company. It guides them to work for achieving the objectives of company and restrains them from doing anything beyond memorandum.
  5. Protect Investors – Memorandum protects the interest of investors because their is a risk when person invest money on a company.

  Framing Memorandum :

Following factors must be considers while framing memorandum of association of a company are :-

  1. Must be in proper form.
  2. Memorandum shall be printed.
  3.  It shall be divided in paragraphs numbered consecutively.
  4. Their should be information regarding subscribers.
  5. Signed by all the subscribers.
  6. It must be stamped as per stamp act .
  7. Date must be written on it.


  1. Name clause – The name of the company should be mentioned in name clause and company can decide any name but cant copy another company name and it ends with private limited.
  2. Situation Clause – The registered office of a company can be shifted from one place to another within the town with a simple intimation to the Registrar. But in some situation, the company may want to shift its registered office to another town within the state. Under such circumstance, a special resolution should be passed. Whereas, to shift the registered office to other state, Memorandum should be altered accordingly.
  3. Objects Clause –  This clause specifies the objects for which the company is formed. It also contain the company objectives and methods to attains objectives of company.
  4. Liability Clause – This clause states the liability of the members of the company. The liability may be limited by shares or by guarantee. This clause may be omitted in case of unlimited liability.                                                               .
  5. Capital Clause – This clause mentions the maximum amount of capital that can be raised by the company. The division of capital into shares is also mentioned in this clause and also states minimum and maximum capital of company.
  6. Subscription Clause – It contains the names and addresses of the first subscribers. The subscribers to the Memorandum must take at least one share. The minimum number of members is two in case of a private company and seven in case of a public company.

Thus the memorandum of association  is most important document and necessary to every organisation. It also known as company foundation because it contain information and company objectives.

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