Corporate Catalogue

Every company limited by shares must have a share capital. Share capital of a company refers to the amount invested in the company for it to carry out its operations. The share capital may be altered or increased, subject to certain conditions. A company’s share capital may be divided into small shares of different classes. The different classes of share capital and the rights attached to these classes are different. Authorised capital‖ or Nominal capital‖ means such capital as is authorised by the memorandum of a company to be the maximum amount of share capital of the company; Paid-up share capital or Share capital paid-up means such aggregate amount of money credited as paid-up as is equivalent to the amount received as paid-up in respect of shares issued and also includes any amount credited as paid-up in respect of shares of the company, but does not include any other amount received in respect of such shares, by whatever name called.

PROCEDURE FOR CHANGE OF SHARE CAPITAL

Alteration of Article Of Association
A company must check its article of association before increasing the share capital whether it is authorized in its articles to change the share capital beyond a certain limit or not. To alter the articles shareholders approval is must in Annual general meeting or extra-ordinary general meeting. An altered article must be filed with the ROC within 30 days of passing the board resolution in the annual general meeting or extra ordinary general meeting
Holding a Board Meeting
A board meeting must be called to take the approval of the members for the change of share capital.To decide the date, time, venue of the Annual General Meeting for the shareholders approval regarding change in share capital and notice for the meeting shall be sent to all the members.
Holding of share holders meeting
A shareholders meeting shall be held to take the approval of shareholders for change in share capital of the company.An ordinary resolution shall be passed in the meeting and it shall be filed with the ROC within a time period of 30 days of passing the resolution.

Filing of documents for change of share capital with the ROC

A company shall file the necessary e-form to the ROC along with the necessary documents to give effect to the change in share capital capital of the company with a specified time period.