Event Based Corporate Filing

CHANGE AUTHORISED CAPITAL: ABOUT: The authorized capital is the maximum amount of capital for which the Company can issue shares to the shareholders. A company may take the necessary steps required to increase the authorized capital limit in order to issue more shares, but it cannot issue shares exceeding the authorized capital limit in any case. The company can increase its Authorized Share Capital, only if it is authorized by its Articles of Association.

Procedure to Change the Authorised Capital

• Check whether Articles of Association of Company contain a provision authorizing it to increase its Authorized Share Capital. If there is no such provision in Articles then appropriate steps are required to be taken to amend its Articles. • Notice to be sent to the directors regarding the agenda of the meeting at least 7 days prior to their respective registered addresses. • At the Board Meeting, pass a Board Resolution to call for an Extraordinary General Meeting and issue notice pursuant to the provision of Section 101 of the Act, where the altered clause on authorized capital in the Memorandum of Association can be presented for approval by passing an Ordinary Resolution. The proposed amendment shall be in accordance with the provisions as set out under Section 60 of the Act. • Notice to be given to the shareholders regarding the particulars of the meeting, including the agenda, date, time, and place of the meeting. • The notice must specify the method of voting to be adopted for the passing of the resolution at the Extraordinary General Meeting.

• Notice of the Extraordinary General Meeting is to be issued to all of the following:-

• Directors

• Shareholders

• Auditors

• The notice of the EGM has to be given not less than 21 days prior to the date on which the EGM is to be held.

However, a shorter notice period can be given if and only if the consent is given by not less than 95% of the members who are entitled to vote at the meeting. The consent has to be obtained either through:

• Writing

• Electronic mode

Hold the General Meeting on the fixed day and pass an Ordinary Resolution for increasing the Authorized Share Capital and make relevant changes in the Memorandum of Association (MOA).

• In less than 30 days of the resolution being passed, a company must file eForm SH-7 and eForm MGT – 14 (if applicable) along with the prescribed fees with the Registrar.

1. Form MGT – 14: This form has to be filed with the RoC first within 30 days of passing the respective resolution. The form is to be filed on the MCA portal, with the following details: • Details of the company, including its CIN. • Purpose concerning which the form is being filed. • Date of dispatch of the notice. • Date of passing the resolution. • Details regarding the resolution. • Digital Signatures and DINs wherever necessary. The following attachments are to be provided: • Notice of the EGM along with the Explanatory Statement as per Section 102. • Certified copy of the resolution passed in the EGM. • Copy of the new MOA (change made in the Capital Clause). • Copy of the new AOA (provision for the increase in authorized share capital).

2. Form SH – 7: This form has to be filed with the RoC within 30 days of passing the respective resolution. The objective of this form is to intimate the Registrar regarding the details of the increase in the authorized capital. The form is being filed on the MCA portal, with the following details: • Details of the company, including its CIN. • Type of resolution. • Date of the meeting. • Service Request Number (SRN) of Form MGT – 14 already filed. • Details regarding the amount of original authorized share capital and amount of new authorized share capital. • details regarding the breakup of the additional share capital. • Particulars regarding the Stamp Duty Fees paid. • Digital Signatures and DINs wherever necessary.

The following attachments are to be provided:

• A certified true copy of the resolution for the alteration of capital. • Copy of the new MOA (change made in the Capital Clause). • Copy of the new AOA (in case of alteration to include provision for the increase in authorized share capital). • Any other optional attachment, if any. The forms must be submitted within the time period stipulated in order to avoid any penalties or subsequent punishment wherein the company as well its officers will be held liable.

Payment of e-Stamp Duty: Pay the e-stamp duty on the increased amount of the Authorized Share Capital through MCA Portal, if applicable.

Alteration in every copy of MOA and AOA: Every Alteration made in the Memorandum of Association and Articles of Association of the Company shall be noted in every copy of the same.

## There may be complex things that occur during the registration process which is a time-consuming and lengthy process. The legal language of these forms is complex in nature. The government Portal and its functionality are in itself quite challenging. The support of professionals and experts can save your precious business time.

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 Working Process:

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BASIC PLAN:

Assistance in CHANGE AUTHORISED CAPITAL. CHANGE AUTHORISED CAPITAL upto 10,00,000/- Rs, Service Fees: 5999/- excluding government Fees.

Law Compliances can help you in obtaining of CHANGE AUTHORISED CAPITAL in 4-7working days.

** ** Time taken for Incorporation/ Registration/ process will depend on the submission of the relevant documents by the client and also approval from the CONCERNED Government authorities.

FREQUENTLY ASKED QUESTIONS (FAQ):

Can paid up capital exceed Authorised capital?

Paid-up capital is the amount of money a company has been paid from shareholders in exchange for shares of its stock. Paid-up capital can never exceed authorized share capital.

How is Authorised capital decided?

It is the maximum amount of the capital for which shares can be issued by the Company to shareholders. The Authorised capital is mentioned in the Memorandum of Association of the Company under the heading of “Capital Clause”. It is even decided prior to incorporation of the Company.

Can Authorised share capital be reduced?

Yes, the Authorized share capital can be reduced, this is known as Diminution. Diminution of capital (i.e. share capital) of a Company means a reduction of the share capital by cancellation of the unsubscribed part of the issued capital.

What is the difference between paid-up and authorized capital?

Authorized capital is the maximum value of the shares that a company is legally authorized to issue to the shareholders. Whereas, paid-up capital is the amount that is actually paid by the shareholders to the company. ***