Increase of Authorised Capital

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Increase of Authorised Capital

The authorised capital of a company is the limit up to which it can issue shares. The process of increasing the authorised capital is 100% online and involves the approval of shareholders in EGM and payment of a fee to the ROC and Stamp duty.

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Step Wise Process

Increase Authorised Capital in India

It is essential to check if the Authorized Capital of the company is adequate for increasing the paid-up share capital of the company. To understand the meaning and difference of these terms, please click here. We at setindiabiz makes your experience of increasing the Authorized Capital of the company and easy, fast and completely online process. For small companies (Capital up to 50 Lakh) and startups, we are offering our services for increasing the Authorized Capital @ Just Rs. 5999/-. The government fee and taxes on actual basis.

Important Points on Increase of Authorised Capital

Process to Increase Authorised Capital of the Company

Obtain Board of Directors Approval for Increase of Capital of Company

To decide on the new limit of the authorised capital, or say alteration of the capital clause of the MOA directors must meet in a legally convened board meeting. The notice sent to directors must contain the agenda of the meeting, and we suggest to include the proposed resolution so that the directors come prepared. We strongly recommend following the standards prescribed by ICSI in SS-1 for board meetings.
Convene an Extraordinary General Meeting (EGM) of Shareholders

The next logical step is to seek approval of the shareholders of the company. The decision of shareholders can be taken only in a valid extraordinary general meeting. To convene an EGM, the directors must send notice to every shareholder of the company at least 21 clear days before the date of EGM. The notice of EGM must contain the agenda, draft of the proposed resolution to be passed as a special resolution.
Filing of Special Resolution to Roc in Form -MGT-14

The special resolution means a decision taken by more than 75% voting rights. The special resolution once adopted in the EGM is then filed before the ROC for their approval. The certified copy of the resolution is filed in Form -MGT-14 with the prescribed fee within 30 days of the passing of the resolution. The altered MOA and the copy of the minutes of the meeting of EGM where the special resolution is passed need to be attached to the form.
Filing of application for Increase in Authorised Capital in SH-7

Once the approval of the shareholders is obtained with the passing of the special resolution in the EGM, the authorised director shall file an application in Form SH-7 with the concerned ROC with attachments like the copy of altered MOA & AOA, Special Resolution etc. With the approval of the SH-7, the authorised capital of the company stands increased.

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