MOA is the charter of the company. It is treated as the constitution of the company. It defines the scope of its activities. It contains the rights, privileges and powers of the company. MOA establishes the relationship of the company with the members. The whole business of the company is built up according to Memorandum of Association. A company cannot undertake any business or activity not stated in the Memorandum. It can exercise only those powers which are clearly stated in the Memorandum. Preparation of MOA is the first step in formation of a company. It is prepared by promoters and submitted to the Registrar for the incorporation of a company.
Lord Cairns defines “Memorandum of Association is the fundamental document of the company. It is foundation on which structure of company stands. It lays down limitations of its activities.”
As per Section 2 (56) of the Companies Act, 2013 states Memorandum means the memorandum of association of a company as originally framed or as altered from time to time in pursuance of any previous company law of this Act.