Distinguish between 'Memorandum of Association' and 'Articles of Association.'
The Memorandum of Association and Articles of Association are two principal documents required for the formation of a company. The Memorandum defines the objects for which the company is formed, whereas the Articles are the rules regarding the internal management of the company, indicating how the objectives are to be achieved.
Regarding their position, the Memorandum of Association is the main document of the company and is subordinate to the Companies Act. In contrast, the Articles of Association is a subsidiary document and is subordinate to both the Memorandum and the Companies Act. The Memorandum defines the relationship of the company with outsiders, while the Articles define the relationship between the members and the company.
In terms of validity, acts beyond the Memorandum of Association are invalid and cannot be ratified even by a unanimous vote of the members. However, acts which are beyond the Articles can be ratified by the members, provided they do not violate the Memorandum.
Finally, regarding necessity, it is compulsory for every company to file a Memorandum of Association. However, it is not compulsory for a public limited company to file Articles of Association, as it may adopt Table F of The Companies Act, 2013.
Explanation
The answer is derived directly from the comparison table and definitions provided in the context. It covers the five main points of distinction: Objectives, Position, Relationship, Validity, and Necessity. The explanation adheres to the word limit for a 5-mark long answer question, ensuring all key differences from the text are highlighted.