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Increase in Authorized Capital
Legally increase your company’s authorized share capital with ROC filing.What’s Included
Timeline
7-12 working days
- Board Resolution
- Shareholders
- Approval
- Updated MOA Copy
Why Us?
Fastest Turnaround
Document Assistance
Legal Consultation
Benefits of Increase Authorized Share Capital
What is an Increase Authorized Share Capital?
A rise in authorized share capital means the official upgrading of the utmost equity capital to be issued by a company legally, as outlined in its Memorandum of Association (MoA). It is an exercise required by the company when it needs to generate further equity capital or issue extra shares to existing shareholders or investors.
The procedure requires the sanction of the Board of Directors and the shareholders through a special resolution, followed by required filings with the Registrar of Companies (RoC) under the provisions of the Companies Act, 2013.
Eligibility for Increase in Authorized Capital (India)
To increase authorized share capital, a company must
• Be registered under the Companies Act, 2013
• Have approval from shareholders via a board/general resolution
• Update the Memorandum of Association (MoA) accordingly
• File Form SH-7 with the Registrar of Companies (RoC)
Documents Needed for Increase in Authorized Share Capital – Comprehensive List
To legally increase authorized share capital of a company under the Companies Act, 2013, the following documents must be prepared, approved, and filed with the Registrar of Companies (RoC)
Board Resolution
A certified copy of the Board Meeting resolution approving the increase in authorized share capital and convening an Extraordinary General Meeting (EGM). It should include
• Approval of the capital increase
• Approval for modification of Clause V of the MoA
• Authorization to file required forms with the RoC
Notice of Extraordinary General Meeting (EGM)
Notice issued to all shareholders under Section 101 of the Companies Act, 2013. The notice must contain
• Date, time, and venue/mode of the EGM
• Detailed agenda
• Explanatory statement under Section 102 justifying the increase authorized share capital
Shareholders' Special Resolution
A certified true copy of the special resolution passed at the EGM authorizing
• The increase in authorized share capital
• Amendment to Clause V of the MoA
Modified Memorandum of Association (MoA)
Updated MoA reflecting the revised capital structure. Clause V (Capital Clause) must be amended to show the increased authorized share capital.
Amended Articles of Association (AoA) (if applicable)
If the existing AoA does not permit the increase, it must be amended through a special resolution and filed with the RoC.
Form SH-7
Statutory form to be filed with the RoC under Section 64 of the Companies Act, 2013.
• Must be properly filled and digitally signed
• Filed within 30 days of passing the special resolution
• Attach all supporting documents for the increase authorized share capital
Form MGT-14
Required for filing the special resolution passed for amending the MoA or AoA. Must be filed within 30 days of the EGM.
Government Fee Payment Receipts
Challans and payment receipts for SH-7 and MGT-14 filings, based on the amount by which authorized share capital is increased.
Digital Signature Certificate (DSC)
DSC of the Director or Authorized Signatory is necessary for digitally signing e-forms.
Director Identification Number (DIN)
DIN of the signing Director must be included in all relevant filings.
Board Report
An internal report detailing the rationale and strategic alignment behind the increase authorized share capital.
Comparison
of Increase Authorized Share Capital
Purpose
- Increase Authorized Share Capital: Expands the company's capacity to issue shares, attracting more investment.
- Professional Tax Registration: Ensures legal compliance by registering for professional tax, an state-level tax on income earned from profession or employment.
Applicability
- Increase Authorized Share Capital: Relevant for companies looking to raise more capital or facilitate share issuance.
- Professional Tax Registration: Mandatory for businesses employing workers or professionals earning a specified income, based on the state’s laws.
Process
- Increase Authorized Share Capital: Requires a special resolution passed by the shareholders and filing with the Registrar of Companies (RoC).
- Professional Tax Registration: Involves registering with the state authorities, submitting required documents, and adhering to state tax laws.
Impact on Business
- Increase Authorized Share Capital: Allows businesses to issue more shares, raise capital for expansion, and improve market valuation.
- Professional Tax Registration: Keeps the business compliant with state tax laws, avoiding penalties and ensuring smooth operations.
Cost & Time
- Increase Authorized Share Capital: Typically involves filing fees and costs associated with shareholder meetings and paperwork.
- Professional Tax Registration: Low-cost registration with a simple process, usually completed within a few days.
Compliance Requirement
- Increase Authorized Share Capital: Required for growth and capital raising but must adhere to legal limits and shareholding regulations.
- Professional Tax Registration: A legal necessity for employers and professionals to remain compliant with local tax laws.
Step-by-Step Process to Increase Authorized Share Capital (India)
Primary Elements of Increase Authorized Share Capital
Boost Your Company’s Capital – Fast!
We handle your Authorized Share Capital Increase seamlessly
Board Resolution, MOA Alteration & ROC Filing—All Covered
100% Online | Expert-Guided | Quick Processing in 5-7 Days | T&C Apply
Inquiry with us
Types of Increase Authorized Share Capital
Boost Your Company’s Capital – Fast!
We handle your Authorized Share Capital Increase seamlessly
Board Resolution, MOA Alteration & ROC Filing—All Covered
100% Online | Expert-Guided | Quick Processing in 5-7 Days | T&C Apply
Inquiry with us
Compliances for Increase Authorized Share Capital
These are mandatory steps to increase authorized share capital
legally under the Companies Act, 2013.
Key Characteristics of an Increase Authorized Share Capital
To increase authorized share capital, a company must
Board & Shareholder Approval
Requires a resolution passed by the Board and shareholders via an EGM.
Alteration of MOA
Memorandum of Association must be updated to reflect the new capital limit.
ROC Filing
Necessary forms (like SH-7) must be filed with the Registrar of Companies.
Stamp Duty Payable
Varies by state and is applicable on the increased amount.
Allows Further Funding
Enables the company to issue additional shares for growth or investment.
Why Increase Authorized Share Capital with Filing Pro
Filing Pro facilitates increasing authorized share capital hassle-free, compliantly, and effectively.
- Professional Advisory – Personalized legal advice in line with the Companies Act, 2013
- End-to-End Support – From preparation of resolutions to ROC filing (Form SH-7)
- Transparency in Pricing – No concealed charges, but transparent, upfront fees
- Fast Execution – Quick processing with correct documentation and filings
Grow your firm's capital ability effortlessly—FilingPro manages the paperwork as you concentrate on growing your business.
Frequently Asked Questions
1. What is increasing the authorized share capital?
Increasing authorised share capital means an increase in the maximum amount of shares a company can issue under its Memorandum of Association (MoA).
2. When should the authorised capital be increased by a company?
A company must take this into account when planning to issue new shares for raising funds, bringing in investors, issuing employee stock options (ESOPs), or fulfilling regulatory requirements.
3. Is shareholder sanction necessary to raise authorized capital?
Yes, shareholder sanction by a special resolution at a general meeting is necessary prior to filing with the Registrar of Companies (RoC).
4. What is Form SH-7, and why is it required?
Form SH-7 is the regulatory form that is used to inform the RoC of changes in authorised share capital, filed along with the revised MoA and board/shareholder resolutions.
5. How long does the process typically take?
The whole process normally takes 5–10 business days, subject to internal approvals and RoC processing schedules.
6. Are there government fees associated with this process?
Yes, government fees for filing are dependent on the quantum by which the authorised capital is to be raised, as stipulated under the Companies (Registration Offices and Fees) Rules.
7. Can authorized capital be raised more than once?
Yes, authorized capital can be raised from time to time whenever required,subject to getting internal and regulatory approvals every time.
8. Does raising authorized capital change paid-up capital?
No, raising authorized capital merely increases the ceiling on possible shares issued. Paid-up capital alters only when fresh shares are issued and subscribed to.