Meaning and Definition of the Articles of Association

Every company incorporated under the Companies Act, 2013 needs two charter documents to come into existence and function — the Memorandum of Association, which fixes the company's name, objects, and the boundaries of what it may do, and the Articles of Association, which is the document this chapter is about. If the Memorandum answers the question "what can this company do," the Articles answer the very different question "how does this company actually run itself, day to day, on the inside."

Section 2(5) of the Companies Act, 2013 defines "articles" to mean the articles of association of a company as originally framed, or as altered from time to time, or applied in pursuance of any previous company law or of this Act. This definition deliberately keeps the door open to change — unlike some clauses of the Memorandum, which can only be altered in narrow, tightly controlled circumstances, the Articles are expected to be revisited and amended as a company grows, restructures, or simply finds that an existing internal rule no longer suits its needs.

In substance, the Articles are the company's own internal rulebook — often described as its bye-laws — covering matters such as how shares are issued, called up, and transferred; how general meetings and Board meetings are convened and conducted; how directors are appointed, remunerated, and removed; and how profits are eventually distributed as dividend. For a student working through this Gujarat board Std 11 Secretarial Practice chapter, the cleanest way to hold the distinction in mind is this: the Memorandum is the company's constitution, defining its powers and its outer limits, while the Articles of Association are the company's rulebook, defining how those powers are actually exercised from within.