Our company name was rejected on RUN. Why, and how to resubmit

You picked a name, checked it and filed it. The MCA portal came back with a rejection, or a "resubmit" status.

This is common and often fixable. Each rejection maps to a written rule. This guide covers the reasons, the clock and the steps to resubmit.

Which form are you in: RUN or SPICe+?

People say "RUN" for every name application. The rules draw a line.

A name for a new company is reserved through the SPICe+ web service (INC-32). A name for a change of name is reserved through the RUN (Reserve Unique Name) web service (rule 9, Companies (Incorporation) Rules, 2014). Many founders still call both "RUN".

Both go to the Registrar, Central Registration Centre, who may approve or reject. The rule allows you to resubmit the web form within fifteen days to fix defects (rule 9, Companies (Incorporation) Rules, 2014).

So a rejection is not always the end. Check the status first. If it shows resubmission, you have fifteen days to fix it.

What you can still do today

You have three options.

• Fix and resubmit the same application, if it is in resubmission status. The name reservation form has a "Resubmission" option where you enter the SRN of the application that is under that status and pre-fill it.
• File a fresh application with a different name, if the first one is closed.
• Attach a supporting document. The form lets you attach regulator approvals, no-objection letters or any other paper the name needs.

The form has two name slots. Use the second for a safe fallback.

The deadline clock

Three clocks matter.

The resubmission window. Fifteen days to rectify defects when the Registrar allows resubmission (rule 9, Companies (Incorporation) Rules, 2014).

The reservation period. When the Registrar approves a name, he may reserve it for twenty days from the date of approval (s.4(5)(i), Companies Act, 2013). For an existing company applying for a change of name, the period is sixty days (proviso to s.4(5)(i), Companies Act, 2013).

The extension. If the incorporation is not ready inside twenty days, you can extend the reservation through SPICe+ on payment of the fee. As the rule reads (rule 9A, Companies (Incorporation) Rules, 2014):

• forty days from approval, for a fee of ₹1,000, if you pay before the first twenty days end;
• sixty days from approval, for a fee of ₹2,000, if you pay before the forty days end;
• sixty days from approval, for a fee of ₹3,000, if you pay before the first twenty days end.

The fee for the name application itself: check the current figure on the MCA portal before you file.

The reasons names get rejected

Every rejection reason below comes from the name rules. Find the one that matches your name.

1. The name is "the same" as an existing company

This is the most common reason. The test is strict.

Your name is treated as too near an existing company's name if, after you disregard certain matters, the two names are the same (rule 8(1), Companies (Incorporation) Rules, 2014).

The rule lists what is disregarded when comparing (rule 8(2), Companies (Incorporation) Rules, 2014):

• words like Private, Pvt, Limited, Ltd, LLP, company, co, corporation, corp or group;
• plural or singular forms. Green Technology Ltd. is the same as Greens Technologies Ltd.;
• letter case, spacing, punctuation and special characters. ABC Ltd. is the same as A.B.C. Ltd.;
• different tenses and phonetic spellings. Chemtech Ltd. is the same as Chemtek Ltd.;
• a host name or domain extension, such as www, net, org, dot or com;
• word order. Ravi Builders and Contractors Ltd. is the same as Ravi Contractors and Builders Ltd.;
• "a", "an" or "the";
• a slight spelling variation, such as Color and Colour;
• a full Hindi or English translation or transliteration of an existing name;
• adding a place name to an existing name that has none;
• adding, deleting or changing numerals, unless the numeral is a brand.

Adding a word that is truly different does help. The rule's own example: Ravi Builders and Contractors Limited is not the same as Ravi Shankar Builders and Contractors Limited (rule 8(2), Companies (Incorporation) Rules, 2014).

One relief exists. A few of these differences, such as the domain extension, word order, the article, the place name and the numerals, stop being disregarded if the existing company gives a no-objection by Board resolution (proviso to rule 8(2), Companies (Incorporation) Rules, 2014). That means a name you thought was blocked may work with the other company's consent.

2. The name resembles a limited liability partnership, or a name already reserved

The name is undesirable if it is identical with, or too nearly resembles, an LLP name, or a name that is for the time being reserved under rule 9. The same comparison rules apply (rule 8A(1)(d) and (e), Companies (Incorporation) Rules, 2014).

It also fails if it matches an LLP in liquidation, or one struck off within five years (rule 8A(1)(o), Companies (Incorporation) Rules, 2014).

Old names stay blocked for a while. After liquidation, two years from dissolution. After a s.248 strike-off, twenty years from the Gazette publication (rule 8A(1)(n), Companies (Incorporation) Rules, 2014). A name released by a company that changed its name is held three years (rule 8A(1)(w), Companies (Incorporation) Rules, 2014).

3. The name includes a registered trade mark

If the name includes a trade mark registered in the same class of goods or services in which you will operate, you need the consent of the trade mark owner. The rule is "save as provided in section 35 of the Trade Marks Act, 1999" (rule 8A(1)(b), Companies (Incorporation) Rules, 2014).

Search registered trade marks and trade mark applications before you file. The declaration you sign says you did (name reservation declaration, Companies (Incorporation) Rules, 2014).

4. The name is too descriptive

A name made only of commonly used words that describe an activity is rejected. The rule's example: Silk Manufacturers Private Limited is descriptive. Silk Wise Manufacturers Private Limited is not, because it has a word beyond the common ones. Your stated objects do not change this test, and the order of words does not either (rule 8A(1)(s), Companies (Incorporation) Rules, 2014).

The fix is simple. Add a distinctive word of your own.

5. The name is only a place, or it implies a place or State link

A name that is only a continent, country, State or city, like Asia Limited or Mysore Limited, is undesirable (rule 8A(1)(r), Companies (Incorporation) Rules, 2014).

The word "State" is not allowed unless the company is a Government company (rule 8A(1)(q), Companies (Incorporation) Rules, 2014).

A foreign country or city in the name needs proof of significant business relations there, like a memorandum of understanding with a company of that country (rule 8A(1)(t), Companies (Incorporation) Rules, 2014).

6. The name signals a different kind of entity

Words that suggest a different business form are barred. The rule's list includes co-operative, sehkari, trust, LLP, partnership, society, proprietor, HUF, firm, Inc., PLC, GmbH, SA, PTE, Sdn and AG (rule 8A(1)(j), Companies (Incorporation) Rules, 2014).

7. Regulated words

Words such as Insurance, Bank, Stock Exchange, Venture Capital, Asset Management and Mutual Fund need a declaration that the regulator's requirements (IRDA, RBI, SEBI, MCA and similar) are met (rule 8A(1)(p), Companies (Incorporation) Rules, 2014).

If the main business is financing, leasing, chit fund, investments or securities, the name must show it. A name that suggests such activity fails if the main business is not that (rule 8A(1)(f) and (g), Companies (Incorporation) Rules, 2014).

8. Words that need Central Government approval

Some words cannot be used without previous approval of the Central Government (s.4(3)(b), Companies Act, 2013). The rule's list includes Board, Commission, Authority, National, Union, Central, Federal, Republic, Minister, Municipal, Panchayat, Court and Bureau (rule 8B, Companies (Incorporation) Rules, 2014).

A name that gives the impression of a link with, or the patronage of, the Central Government, a State Government or a local authority cannot be registered unless the Central Government has previously approved it (s.4(3)(a), Companies Act, 2013). So does one implying a link to a national hero or a senior Government figure (rule 8A(1)(m), Companies (Incorporation) Rules, 2014).

9. Other reasons

• It breaches the Emblems and Names (Prevention of Improper Use) Act, 1950 (rule 8A(1)(a), Companies (Incorporation) Rules, 2014).
• It has a word offensive to any section of people (rule 8A(1)(c), Companies (Incorporation) Rules, 2014).
• It implies a link with a foreign embassy or consulate, or contains "British India" (rule 8A(1)(l) and (k), Companies (Incorporation) Rules, 2014).
• A section 8 company's name lacks a word like Foundation, Forum, Association, Federation, Chambers, Confederation, Council or Electoral Trust (rule 8A(1)(u), Companies (Incorporation) Rules, 2014).

The declaration on business history

You must also state whether you are using, or used in the last five years, the same name in another business form, such as a sole proprietorship, a partnership or another entity. If yes, give details and attach a no-objection from the other partners and associates. You must also state whether that other business will be taken over by the new company (rule 8A(2), Companies (Incorporation) Rules, 2014).

Answer exactly and attach the paper.

Step by step: fix and resubmit

• Read the rejection note and match it to the list above.
• Check the status. Under resubmission means you are inside the fifteen-day window (rule 9, Companies (Incorporation) Rules, 2014).
• Search again. The declaration you sign says you used the MCA name search for companies and LLPs, and searched trade marks (name reservation declaration, Companies (Incorporation) Rules, 2014). Repeat both on your new name.
• Change the name in a real way. Reversing word order, or switching singular to plural, does not work. Both are disregarded in the comparison (rule 8(2), Companies (Incorporation) Rules, 2014). Add a distinctive word.
• Attach the paper the name needs. Trade mark consent, a Board-resolution no-objection, a regulator declaration or foreign-relations proof.
• Resubmit through the form. On the name reservation form, choose Resubmission and enter the SRN. Submit before day fifteen.
• Once approved, start the clock. You have twenty days from approval for the new company, unless you extend it (s.4(5)(i), Companies Act, 2013; rule 9A, Companies (Incorporation) Rules, 2014).

What not to do

• Do not give wrong information to get a name through. If wrong information is found after reservation and the company is not yet incorporated, the reserved name is cancelled. The applicant can face a penalty up to one lakh rupees (s.4(5)(ii)(a), Companies Act, 2013).
• If the company is already incorporated, the Registrar can, after hearing it, direct a change of name within three months, strike the name off, or petition for winding up (s.4(5)(ii)(b), Companies Act, 2013).
• Do not rely on a spelling twist. Different spellings do not distinguish names (rule 8(2), Companies (Incorporation) Rules, 2014).

What to do now

• Next step: Open the application on the MCA portal and read the rejection reason. If it is in resubmission, fix the defect and resubmit (rule 9, Companies (Incorporation) Rules, 2014).
• Deadline: Fifteen days to resubmit (rule 9, Companies (Incorporation) Rules, 2014). Once approved, twenty days to incorporate, or extend before the twentieth day for the figures in rule 9A (s.4(5)(i), Companies Act, 2013; rule 9A, Companies (Incorporation) Rules, 2014).
• Consequence: The reservation lapses. Wrong information can bring cancellation of the reserved name and a penalty up to one lakh rupees (s.4(5)(ii)(a), Companies Act, 2013).

Have a CA review your facts before you act or file.

FAQs

Can I use a name that is already a registered trade mark?
Only with the consent of the trade mark owner, where the mark is registered in the same class of goods or services as your activity (rule 8A(1)(b), Companies (Incorporation) Rules, 2014). Search the trade mark records before you file.

How many names can I propose?
The name reservation form has two name fields, Proposed Name 1 and Proposed Name 2.

How long does an approved name stay mine?
Twenty days from approval for a new company, unless extended. Sixty days for an existing company changing its name (s.4(5)(i) and proviso, Companies Act, 2013).

My name is blocked by an existing company. Is there a way through?
For some differences, yes. If the existing company passes a Board resolution giving a no-objection, those differences are no longer disregarded (proviso to rule 8(2), Companies (Incorporation) Rules, 2014). The other company has to agree, so plan for that.

What does the name application cost?
Check the current fee on the MCA portal before you file.

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See Also

• Changing our company's name: what the law needs and how it is done
• Converting our LLP into a private limited company
• Startup India (DPIIT) recognition rejected — what to fix and reapply