Increase Authorised Share Capital
We will give you a personalized consultation while helping you increase your authorised share capital. Our dedicated team of Share Transfer Agents in India offers tailored solutions for share transfer and valuation needs in Chennai. With precision and expertise, we navigate the complexities, ensuring a seamless process for your valuable shares.
Elevate your business potential with our expert Authorized Share Capital services. Our streamlined Authorized Capital Increase process ensures efficiency and precision, paving the way for your company’s financial growth.
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Easy And Simple Process
1. Fill Form
Simply fill the form to get started
2. Call to Discuss
Our expert will connect with you & prepare documents
3. Process Completed
MOA and AOA are amended and ROC is intimated of the increase
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ExpertPoint can help you with increase in authorized share capital of your company. Quick and hassle free process
Learn more about Increase Authorised Share Capital
Increase Authorised Share Capital
Section 2(8) of the Companies Act, 2013 defines ‘authorised capital’ or ‘nominal capital’ as it is authorised by the memorandum of a company to be the maximum amount of share capital of the company. This simply means the company can expand its business upto the level of authorised capital.
As a business grows the directors may need additional funds for scaling operations. If the funds needed are in the long-term, then the consideration of adding few more investors into the business. By Increasing your Authorised Share Capital, your company can raise funds by issuing additional shares to investors.
Requirements
Documents required:
- Copy of altered memorandum of association (for change in capital clause) and Articles of association (for authorization to increase authorised capital)
- Notice of Annual General Meeting or the Extra-Ordinary General Meeting
- The document which holds the consent of the shareholders
- Filing of form SH-7 and MGT-14 within 30 days of resolution
Steps to increase the authorised capital:
Step 1. Review the Article of Association (AOA) for Authorization of increase in authorized capital
Step 2. Convene the Board meeting
Step 3. Holding of Extraordinary General Meeting (EGM) and pass ordinary resolution. Alter MOA and AOA if required.
Step 4. File MGT-14 and SH-7 with Registrar of Companies
Advantages
- The share capital determines the strength of the company financially which may make it appealing for bank loans and additional investors
- The networth of the company increases
- The borrowing capacity of the company increases
- It effects the overall company’s share capital
- It gives high potential for the process of expanding the company
Timelines and next steps
- Verifying and Amendment of Articles of Association (AoA)
Section 61 of the Companies Act, 2013, dictates that expanding the Authorised capital needs approval in Articles of Association. Hence verifying if AoA has clearly has provisions for increasing authorised share capital. If not, there needs to be an Amendment as per Section 14 of the Companies Act, 2013 by passing a special resolution.
- Holding a Board Meeting
Get approval from the board of Directors to increase authorized share capital. Decide the date and time to call an AGM or EGM to take the shareholders’ approval. A notice for holding an AGM or EGM must be sent to all the shareholders as per the rules. A director must be authorized to file all the necessary forms with the MCA.
- Convening Extraordinary General Meeting (EGM)
Hold the Extraordinary General Meeting (EGM) of the members on the Day, Date, Time, & Venue as decided by the board of directors in their board meeting and the pass the Ordinary Resolution for increase in authorised share capital.
- File ROC Forms
- Form MGT-14: This form has to be filed with the RoC first within 30 days of passing the respective resolution.
The following documents have to be attached in MGT-14: 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 authorised share capital). - 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 authorised capital.
- Allotment of Fresh Shares
After the increase in authorised share capital, the paid-up share capital of the company is increased by issuing fresh equity shares. Valuation report has to be obtained and PAS forms have to be filed with the Registrar.
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