Increase in Paid-up Capital

Introduction

Elevate Your Business with CorpIQ's Paid-up Capital Increase Services

Growing your business often requires an infusion of funds. Increasing your paid-up capital not only strengthens your financial base but also enhances your credibility in the market. CorpIQ's expert services are designed to guide your company through the process of increasing paid-up capital, in line with the Companies Act, 2013, and other regulatory mandates. Our proficient team, composed of Chartered Accountants, Company Secretaries, and Lawyers, ensures that your paid-up capital increase is executed flawlessly and efficiently.

CorpIQ's DETAILED APPROACH TO PAID-UP CAPITAL INCREASE

- Comprehensive Analysis: We start with a thorough analysis of your company's financial structure and strategic objectives to determine the optimal approach to increasing your paid-up capital.

- Regulatory Compliance: CorpIQ ensures that all steps taken to increase your paid-up capital comply with statutory regulations, safeguarding your company from any future compliance issues.

- Streamlined Process Management: From the preparation of board resolutions to the execution of share allotment and filing of return of allotment in Form PAS-3, our team manages the entire procedural spectrum.

- Shareholder Engagement: We assist in convening a General Meeting to obtain shareholder approval, as required for the capital increase, and provide end-to-end support in documenting the process transparently.

- Certification and Documentation: CorpIQ takes charge of the certification of new share certificates, updates to statutory registers, and amendments to the company's charter documents to reflect the new capital structure.

- Advisory Impact: Our experts advise on the potential effects of increased paid-up capital on your company's financial planning, investor relations, and market positioning.

By partnering with CorpIQ for your paid-up capital increase, you are choosing a path of strategic financial growth with a partner that values precision, compliance, and the long-term vision of your business.

LEGAL SIDE OF PAID UP CAPITAL INCREASE

It is necessary to invest a certain amount in any company in order to carry out its business activities, so that it can be incorporated. This amount is known as the share capital, and it is the maximum amount that a company can issue its shares for. As opposed to authorized share capital, paid-up share capital is the aggregate estimation of the offers that a company has made. Authorized share capital represents the offers that an organization can make, while paid-up share capital represents the aggregate estimate of the offers that have been made by the organization.

At any time after incorporation, a company's authorized share capital and paid-up share capital may both be increased, but the paid-up share capital cannot exceed its authorized share capital.

FEATURES:

• Prior to issuing new value shares and expanding paid-up capital, a company may need to expand its Authorised capital. Paid-up capital is the aggregate estimate of offers issued by an organization, while authorized capital is the aggregate estimate of offers issued by the organization Paid-up capital can never exceed authorized capital.

• A company having an authorized capital of Rs.10 lakhs and a paid-up capital of Rs.10 lakhs may now enlist new investors by using one of the following options:
• Expanding the authorized share capital and issuing new shares.
• Alternatively, the exchange of shares between existing and new investors.

• Changes to the share capital of a company are governed by Section 61 read with Sections 13 and 64 of the Companies Act, 2013.

• In order for a resolution to be passed at the extra ordinary general meeting, a resolution needs to be adopted by all the members of the board following the confirmation of the AoA of the company.

• To increase the share capital of the company, our team of experts will collect a copy of the notice for the meeting and a copy of the resolution passed at the meeting and file appropriate E-Forms with the ROC.

 

BENEFITS

The following are some of the benefits of increasing capital :-

• If you have an idea of growing your business, you need to infuse your business with a substantial amount of paid up capital.
• As a result, a company with more capital will be able to tap more innovative ideas. Therefore, by increasing the paid up capital, the company can become more innovative.
• With the fast pace of technology, we can easily provide competition to the market by raising capital. Therefore, if we want to compete and stay in business, we would need to have more capital.
• The market is changing very fast with the changing environment. Thus, in order to satisfy our consumers, we need to make our business better, and to do so we must increase our paid-up capital.

 

PROCEDURE

A company's paid-up share capital can be increased by issuing and allocating new shares at a Board Meeting with the consent of all its shareholders. A return of distribution must be submitted to the responsible Registrar of Companies in accordance with the Companies Act, 2013. Our experts will carry out this process as explained here:

• Members of the Board will conduct a General Meeting or a Board Meeting in order to distribute and allocate the new shares to the Shareholders.
• The notice of the meeting and the board resolution will be required by our team to file Form SH-7 once the Members approve the increase in paid-up capital.
• In order to file SH-7, it is mandatory to attach a list of the shareholders who have been allocated new shares, as well as the amount of each share.
• Form SH-7 must be verified by a certified Chartered Accountant or Company Secretary.

The Registrar will approve the increase in the paid-up share capital of the company once SH-7 has been successfully submitted with the concerned RoC.