One can become a member of a company by any one of the following ways: -

1. By subscribing to the memorandum of association: A subscriber to the memorandum of association becomes a member on incorporation of the company in respect of the shares subscribed by him without any further act by him. He will be liable for whatever number of shares he has subscribed for up to the uncalled amount on those shares. A Subscriber to the memorandum cannot have canceled their membership on the ground that he was induced to become a subscriber by the promoters of the company.

2. By agreeing in writing to become a member in any of the following ways provided the name is entered in the Register of Members of the Company.

- By application and allotment

- By taking a transfer of shares

- By transmission of shares

Membership may be acquired from an existing member by purchase of the shares of the transferor and lodging with the company a transfer deed duly executed by both the transferor and the transferee together with the share certificate. When the transfer is registered by the company, the name of the transferee is entered in the register of members of the company in place of the transferor.

In the case of transmission, a person can become a share holder in consequence or by reason of the death or bankruptcy of a member or any other event constituting transmission. But that person will become a member only when he applies in writing requesting the company to make him a member and the company puts his name on the register of members.

3. By allowing his name to be on the register of members or otherwise holding himself out as a member or allowing himself to be held out as a member. A person will be deemed to be a member if he allows his name to be on the register of members or otherwise holds himself or allows himself to be held out as a member. Any person competent to enter into a contract can become a member of the company. It need not be in writing.

Any person competent to enter into a contract can become a member of a company.

The following persons are not competent to contract: -
1.Minors: A person who has not attained the age of 18 years is a minor. In case of a person to whose property a guardian has been appointed, the age of majority is 21 years.

2.Persons of unsound mind

3.Citizens of Enemy Countries i.e. Alien enemies.

4.Insolvents

Cessation of membership :

A person ceases to be a member of the company in any of the following ways: -

a) By transferring his shares to another person. However, the transferor will continue to be a member until the shares are registered in the name of the transferee.

b) By forfeiture of his shares on non-payment of calls due

c) By a valid surrender of shares to the company

d) By death but until the shares are transmitted to his legal heirs, his estate will be liable for any money due on the shares;

e) By the company selling his shares in exercise of its right under the articles of association of the company

f) By the Court or any other competent authority attaching and selling the share in satisfaction of decree or claim

g) By redemption of the preference shares;

h) By the official assignee disclaiming his shares on his adjudication as an insolvent

i) By rescission of contract of membership on the ground of misrepresentation or mistake.

j) By the company buying back the shares.