Q.What is meant by the 'doctrine of ultra vires' in relation to the Memorandum of Association?

The Object Clause of the Memorandum is what sets the outer legal boundary a company can never cross, no matter how many members agree to it. …

The Memorandum of Association, under Section 4 of the Companies Act, 2013, fixes the scope of a company's lawful activity chiefly through its Object Clause. Any act the company carries out that falls outside this stated scope is said to be ultra vires the company — literally, 'beyond the powers' of the company. Such an act is not merely irregular; it is void from the start, and — unlike an act that merely breaches the company's own Articles — it cannot be validated or ratified, not even if every single member of the company later agrees to it. This is because the Memorandum exists partly to protect outsiders (creditors, investors, persons dealing with the company) who rely on its publicly-filed objects when deciding whether to transact with the company; letting the members retroactively bless an ultra vires act would defeat that protection. The doctrine therefore encourages a company's promoters to draft the Object Cla …

Students often confuse an act that is ultra vires the Memorandum (void, never ratifiable) with an act that is merely ultra vires the Articles but within the Memorandum (irregular, but ratifi …