Change in Authorized Share Capital

If an organization wishes to expand its paid-up capital, it can expand it by offering the Right Issue of shares. The right Issue can be offered to current investors under a plan of workers' investment opportunity, subject to a special resolution passed by the organization.

The measure of share capital can be either expanded or decreased. In either case, the Companies Act manages the methods for such changes. The share capital can be changed via a share issue, Issue of alternative rights or other unique rights, an increment from reserves, or interest in share capital.

Capital reorganization is a critical change in Share Capital to an organization's structure. Capital redesigns include: Reducing share capital. This might be finished by uniting shares, or by lessening the par value of shares.

The fundamental difference between the authorized share capital and paid-up share capital is that the authorized share capital is the most significant value of shares that an organization can issue to its investors. While a Paid-up Capital is the piece of approved share capital for which the shares were given to the investor.

A company can raise share capital from the primary market by means of various methods. The methods may induce public issues, offer for sale, private placement, right Issue, and tender process. This is the most famous method of rising for long term capital. It expresses the raising funds directly from the public.

A company can raise share capital from the primary market by means of various methods. The methods may induce public issues, offer for sale, private placement, right Issue, and tender process. This is the most famous method of rising for long term capital. It expresses the raising funds directly from the public.

If the authorized by its articles, a company may utilised any undistributed profits to the company's share premium account or capital redemption reserve to finance an issue of wholly or partly paid-up bonus shares in proportion to their existing holdings.

If the authorized by its articles, a company may utilised any undistributed profits to the company's share premium account or capital redemption reserve to finance an issue of wholly or partly paid-up bonus shares in proportion to their existing holdings.

The increase in capital shall receive following consent or approval:

The form must be filed within 30 days after obtaining consent from shareholders for the share capital increase. The resolution passed is notified in MGT-14 and notice of increase is filed in SH-7 with altered MoA and AoA.

Yes, the total authorized and paid-up capital is displayed on the Master Data of the company on the MCA portal.

The Government fee for any e-form filed with MCA depends on the authorized capital of the company. With the increase in Authorised capital, the Government fee for online filing also increases, however to a nominal extent.

Yes, the package cost also includes the increase in paid-up capital of the company, but not the transfer of shares.

The maximum value of securities that can be issued by a company is referred to as the authorized capital.

With the relevant documentation, the process for increasing the share capital of a company can be completed within 5-6 days. However, if there is any complication or delay in submission of the documents, the time duration may vary.

The capital of a company is the amount of money which is received by the shareholders to carry out the business activities of the company. The rules and regulations regarding any kind of capital is mentioned under the ‘Capital Clause’ of the Memorandum of Association of the company.The capital invested in a company can be of two kinds –
Authorized Capital – This is the maximum value of securities which the company can legally issue to its shareholders in the form of shares. The authorized share capital is always greater than the paid-up share capital and can be increased at any time with prior approval from the shareholders by passing a resolution
Paid-up Capital – This is the sum of money that is actually paid or invested by the shareholders of the company. Under the Companies Amendment Act, 2015, the requirement of having a minimum paid-up share capital has been removed at the time of incorporation of a company.

TWhen a company is registered, the promoters of the company decide an amount for the authorized capital and the share value they will receive in return if they invest in the company.However, as per recent amendment in Companies Act, there is no requirement of minimum capital to register a company.Authorized Capital or Registered Capital is the maximum limit of the capital up to which a company can issue shares and collect money from its shareholders. The authorized capital can be increased at any point of time after the incorporation of the company by passing a resolution in a meeting of the shareholders.