How to select a company name to avoid rejection?

By Hiral Vakil on March 11, 2019

The name of the company should be selected with utmost care.The following are some rules to be kept in mind:

  • The name must be unique.
  • In case of private company the name should be ended with the words “Private Limited”, “OPC” in case of One Person Company and “LLP” in case of Limited Liability Partnership which is mandated by law.
  • Follow the naming guidelines for better chances of approval.
  • It should be according to activities described in main objects.

Following are the rules to keep in mind:

  • The proposed name should not be identical with or resemble too nearly to the name of any existing company or LLP registered under this act or any previous company law. You can check the company name from here.
  • The name shall be considered undesirable if 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 has been obtained and produced by the promoters, you can check out the registered trademark from here.
  • The name shall be considered undesirable if any part of the proposed name includes the words indicative of a separate type of business constitution e.g. co-operative, sehkari, trust, LLP, partnership, society, proprietor, HUF, firm, Inc., PLC etc.;
  • The proposed name shall not contain the words ‘British India’
  • The name shall not imply association or connection with embassy or consulate or a foreign government;
  • The proposed name is considered undesirable if it includes or implies association or connection with or patronage of a national hero or any person held in high esteem or important personages who occupied or are occupying important positions in Government;
  • The proposed name shall not include words such as ‘Insurance’, ‘Bank’, ‘Stock Exchange’, ‘Venture Capital’, ‘Asset Management’, ‘Nidhi’, ‘Mutual fund’ etc., unless a declaration is submitted by the applicant that the requirements mandated by the respective regulator, such as IRDA, RBI, SEBI, MCA etc. have been complied with by the applicant;
  • The proposed name is considered undesirable if it contains only the name of a continent, country, state, city such as Asia limited, Germany Limited, Haryana Limited, Mysore Limited
  • The proposed name includes name of any foreign country or any city in a foreign country, the same shall be allowed if the applicant produces any proof of significance of business relations with such foreign country like MOU with a company of such country,
  • The name of the proposed company must not contain any word or expression which is likely to give the impression that the company is in any way connected with, or having the patronage of, the Central Government, any State Government, or any local authority, corporation or body constituted by the Central Government or any State Government under any law for the time being in force, unless the previous approval of the Central Government has been obtained for the use of any such word or expression.
  • In case the key word used in the name proposed is the name of a person other than the name(s) of the promoters or their close blood relatives, No objection from such other (s) shall be attached with the application for name. In case the name includes the name of relatives, the proof of relation shall be attached. It shall be mandatory to furnish the significance and proof thereof for use of coined words made out of the name of the promoters or their relatives.
  • The applicant shall declare in affirmative or negative ( to affirm or deny ) whether they are using or have been using in the last 5 years , the name applied for incorporation of company or LLP in any other business constitution like Sole proprietor or Partnership or any other incorporated or unincorporated entity and if, yes details thereof and NOC from other partners and associates for use of such name by the proposed Company or LLP as the case may be and also a declaration as to whether such other business shall be taken over by the proposed company or LLP or not .
  • For the Companies under Section 8 of the Act, the name shall include the words foundation, Forum, Association, Federation, Chambers, Confederation, council, Electoral trust and the like etc. Every company incorporated as a “Nidhi” shall have the last word ‘Nidhi Limited’ as part of its name.
  • Words such as Board, Commission, Authority, Undertaking, National, Union, Central, Federal, Republic, President, Municipal, Panchayat, Development Authority, Minister, Nation, Small Scale Industries, Governor etc, shall not be used in the name of a company in English or any of the languages depicting the same meaning unless the previous approval of the Central Government has been obtained for the use of any such word or expression

To gain more clarity on the same, you can refer the Instruction Kit provided by MCA.