ISSUE:
Whether the company can enter into a contract that is beyond the scope of the object clause in the MOA of the company?
RULE:
The Ashbury Railways case laid the foundation of the ultra vires rules and confined the acts of the company within the ambit of the object clause of the MOA. This was rendered moot to a great extent after the introduction of the changes in the Companies Act 2006 since section 17 of the Act does not mandate any company to have a MOA.