Increase in Authorized Capital
Sometimes companies wish to increase their capital base by issuing new share capital. Companies cannot issue share capital beyond its authorized capital, so before issue of new share capital authorized capital is required to be enhanced. For enhancing authorized capital some fees to the government is required to be paid which is payable for under various slabs so it is cost saving decision to enhance maximum capital at lowest cost.
Increase in authorized share capital of the company requires calling board meeting, passing of special resolution, alternation of memorandum of association and filing of application with Ministry of corporate affairs. Filing of necessary forms and supporting documents including altered memorandum of articles is an important aspect and requires expert support and professional guidance.
We at TaxMuneem take care of all your needs by providing personal supervision to compile forms and supporting documents.
Fees for filing the Application with MCA
Drafting of Special resolution and board minutes
Alteration of memorandum of association
Any fees payable in case the application is rejected.
Stamp duty and fee payable to ROC for increase in authorized capital.
Any penalty amount in case of non-compliance
Copy of Resolution for Alteration of Share Capital
Copy of Board Resolution authorizing redemption of Preference Share Capital
Altered Memorandum of Association
Altered Articles of Association
Any other information
2-3 weeks time for filing and processing of application.
An Authorized Share Capital can be increased at any time at the will of the Company.
An Authorized Share Capital of the Company can be increased by following the procedures are follows: –
- Approval within the Articles of Association: First Check whether, there is, a provision to increase the Share Capital of the Company. If not, then, Articles of Association shall be amended.
- Convening of a Board Meeting: The Board Meeting shall be called to discuss the proposal for increase in the Authorized Share Capital and calling a meeting of the Shareholders by way of a General Meeting.
- Approval of Shareholders: The Approval of the Shareholders shall be required by was of passing a Special Resolution in the General Meeting.
- Filing the Documents with the Registrar: After the approval of the Shareholders of passing of the Special Resolution, the company shall be required to file such resolution and the necessary documents with the Registrar of Companies.
The Company shall be required to file Form SH-7 with the Registrar under whose Jurisdiction the Registered office of the Company vests.
No, the government Approval shall not be required for this purpose provided Government is not holding any Shares in the Company. The govt. for the purpose can be either Central Government or the State Government or both.
Section 450 shall apply in this case. Accordingly, if the person or any officer of the company or any person contravenes with the provision of this Section, then, the company and every officer in default or any such person shall be punishable with a fine which may extend to Rs. 10,000/- and Rs. 1,000/- for every day during which the default continues.