What is meant by common seal of a company?

Question

Answer

A company seal (sometimes referred to as the corporate seal or common seal) is an official seal used by a company. Company seals were predominantly used by companies in common law jurisdictions, although in modern times, most countries have done away with the use of seals.

In the UK, a company may have a company seal under the provisions of Companies Act 2006 section 45. It may have further seals for other territories and for issuing securities. These seals have the additional legend of the territory or the word SECURITIES. A company may wish still to seal documents as a means of protection against forgery.

Traditionally, the seal was of some legal significance because the affixing of the seal signified that the document was the act and deed of the company, whereas when a document was merely signed by a director, then that was deemed to be an act carried out on behalf of the company by its agents, which was subject to applicable restrictions and limitations under the ordinary law of agency.

Answer

Common seal is a special seal bearing the name of a company and which remains in the possession of its secretary. it is essential to have the common seal along with the signatures of at least two directors as witness to give any document a legal shape.

Answer

We all are aware that a Company being an artificial person does not have a physical presence. Therefore, it acts through its Board of Directors for carrying out its activities and for entering into various agreements. The Company uses Common Seal as its Signature. Here, comes the role of “Common Seal”.Definition of Common Seal: There is no definition prescribed under the Companies Act, 2013. As per the Secretarial Standards issued by Institute of Company Secretaries of India, Common Seal means, the metallic seal of a company which can be affixed only with the approval of the Board of Directors of the Company. It is the signature of the company to any document on which it is affixed and binds the company for all obligations undertaken in the document. In other words, Common Seal is the official signature of the company and each company shall have only one seal, on its incorporation. It is to be used in the manner prescribed in the Articles of Association and the Companies Act, 2013. Any document, on which the company’s seal is affixed and is duly signed by the authorized official of the company becomes binding on the company.

Affixing of Common Seal under the Act

Article 2(ii) of TABLE F - Articles of Association of a Company Limited by Shares specifies that every certificate shall be issued under the seal of the Company. 79. (i) & (ii) of TABLE F and 30(i) & (ii) of TABLE H – (Articles of Association of a Company Limited by Guarantee and not having Share Capital) provides that (i) the Board shall provide for the safe custody of the seal. (ii) The seal of the company shall not be affixed to any instrument except by the authority of a resolution of the Board or of a committee of the Board authorised by it in that behalf, and except in the presence of at least two directors and of the secretary or such other person as the Board may appoint for the purpose; and those two directors and the secretary or other person aforesaid shall sign every instrument to which the seal of the company is so affixed in their presence.

Answer

Common Seal of a Company

The common seal of a company, also known as the corporate seal or company seal, is an official stamp or embossed design that represents the legal identity of a company. It is used to authenticate and validate important documents, such as contracts, deeds, share certificates, and other official paperwork. The common seal is typically affixed on these documents to indicate that they have been duly authorized and executed by the company.

Importance and Purpose of a Common Seal

The common seal serves several important purposes for a company:

1. Legal Authentication: The seal acts as proof that a document has been authorized by the company and is legally binding.

2. Official Representation: The seal represents the company's identity and signifies the company's official status.

3. Protection against Forgery: The unique design and embossment of the seal make it difficult to duplicate, providing protection against fraudulent activities.

4. Historical Significance: The common seal has historical significance and is often considered a symbol of tradition and authenticity.

Process of Obtaining a Common Seal

To obtain a common seal for a company, the following steps are typically followed:

1. Resolution: The company's board of directors must pass a resolution approving the decision to obtain a common seal.

2. Design and Creation: The company must create a design for the seal, which usually includes the company name, registration number, and other relevant details. The design is then sent to a seal manufacturer for creation.

3. Registration: Once the seal is created, it may need to be registered with the relevant authorities, depending on the jurisdiction in which the company operates.

Usage and Execution of the Common Seal

The common seal is typically affixed on documents in the following manner:

1. Stamping: The seal is stamped onto the document using ink or a special embossing tool.

2. Signatures: The seal is usually accompanied by the signatures of authorized personnel, such as directors or company secretaries.

3. Record Keeping: The company must maintain a register of documents on which the common seal has been affixed, along with details such as the date, purpose, and parties involved.

Conclusion

The common seal of a company plays a crucial role in legalizing and authenticating important documents. It represents the company's identity, provides protection against forgery, and carries historical significance. Obtaining and using a common seal requires proper procedures and adherence to legal requirements to ensure its validity and effectiveness.

Answer

A company is an artificial person.So it caanot be signed.Therefore common seal is the substitute signature of the company.

Answer

A company seal (sometimes referred to as the corporate seal or common seal) is an official seal used by a company. Company seals were predominantly used by companies in common law jurisdictions, although in modern times, most countries have done away with the use of seals.

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