Article Of Association: Legal Significance In Corporate Governance
- IJLLR Journal
- Jun 7
- 1 min read
Diksha Sharma, Gitarattan International Businesses School
Madhav Kalra, Vivekananda Institute of Professional Studies
Introduction
In the intricate framework of corporate law, the Articles of Association (AOA) occupy a central and indispensable role. While the Memorandum of Association (MOA) delineates the company’s external parameters, objectives, scope, and relationship with the outside world, the AOA concerns the business organisation’s internal machinery. It acts as the company’s internal constitution, laying down the rules and procedures governing the conduct of directors and shareholders and the functioning of various corporate bodies.
The AOA is not merely a procedural document; it is a legally binding instrument that determines how a company operates daily. Its significance is especially evident during internal disputes or when corporate decisions are challenged in courts. One such landmark instance is the Tata-Mistry dispute, where the interpretation of the company’s articles became a focal point of litigation. This article undertakes a detailed exploration of the legal import of the AOA, its binding nature, and the judicial stance on its alteration and enforcement, particularly in the context of the Tata-Mistry judgment.
The Articles of Association: A Binding Corporate Constitution
The AOA, as mandated by Section 5 of the Companies Act, 2013, is a required constitutional document for every company. It functions as a statutory contract between the company and its members, and also inter se among the members.1 This statutory contract governs essential aspects such as:
• The appointment, powers, and remuneration of directors,
