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Question
Distinguish between 'Memorandum of Association' and 'Articles of Association.'
Solution
|
Basis of difference |
Memorandum of Association (MoA) |
Articles of Association (AoA) |
|
Objective |
The MoA defines the character of a company and the scope of its activities. |
The AoA defines the rules and regulations of the company. |
|
Position |
It is the main document of a company which is subordinate to the Companies Act. |
It is the subsidiary document of a company which is subordinate to both MoA and the Companies Act. |
|
Relationship |
The MoA establishes the relation between the company and outsiders. |
The AoA defines the relation of the company with its members. |
|
Alteration |
Altering the MoA requires the approval of statutory authority. |
The AOA can be easily altered by passing a resolution. |
|
Ratification |
Acts beyond MoA cannot be ratified. |
Acts beyond the AoA can be ratified by the members if they do not violate the MoA. |
|
Necessity |
It is a necessary document. |
It is a secondary document. |
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