RE: Legal Opinion regarding change of name and style of account “Company 1” to “Company 1” in Bank 1’s.
We refer to your letter no. ………….. dated 26 December 2006 on the above subject.
From perusal of your letter and the provided documents, it appears that currently Company 1 is maintaining a Current Account in the name and style of “Company 1” with Bank 1’s ………..
Now Company 1, India has requested the Manager, Sreemongal Branch to convert the name and style of the account of Company 1 into “Company 1, India” and they have submitted necessary papers/documents in support of their prayer, which include:
a) Memorandum and Articles of Association
b) Certificate of Incorporation
c) Trade License
e) Board Resolution for opening Bank Account in Bangladesh.
In these circumstances, you have requested our legal opinion as to whether there are any legal complications in the Bank converting the name and style of the said account in the said manner.
Company 1 was a partnership business duly registered under the Indian Partnership Act 1932 and the account in question is in the name of this partnership. Now, this partnership has been converted into a limited company named “Company 1” under the Companies Act 1956 of India. Now Company 1, India has requested the Manager, Sreemongal Branch to convert the name and style of the account of Company 1 into “Company 1, India”
In our opinion, the partnership and the company are two entirely different legal entities and as such, a bank account in the name of one may not be converted into the name of the other.
Moreover, from perusing the minutes of the board Resolution of the Company dated 22.11.2006, it appears that the board resolution authorises the Company to OPEN a current account of the company with Bank 1, Sreemongal Branch. The board resolution does not authorise the conversion of the name and style of the account of “Company 1” into “Company 1, India”.
That is why we suggest that, the Bank should ask Company 1 to open a new account in the name of “Company 1”. After that, the Partnership should write a letter to the Bank asking them to close the account of “Company 1” and authorising the Bank to transfer the outstanding balance to the account of “Company 1”.
If you have any further query, please do not hesitate to contact the undersigned.
For: “The Lawyers & Jurists”