The Delhi High Court has ruled that even if a certain power is not mentioned in the memorandum of association (MoA) of a company, it can still be executed if it is incidental to the running of the main business.
The absence of a clause cannot deprive a company from doing anything to further its business if it comes under the implied powers of the company, said Justice SK Mahajan.
The ruling came following a suit filed by Rajiv Motors against the Land and Development Office of Delhi. Rajiv Motors had purchased a property in Connaught Place in 1981 where it currently has its showroom. Recently the company applied for mutation (to have the land in its own name) to the Land and Development Office. The office refused mutation on the ground that the memorandum of association of the company was silent on acquisition of property. The Land and Development Office