The Classic Partners LLP

Authorized Capital Increase

Quick and compliant increase of your company's authorized share capital under Section 61 of the Companies Act, 2013 — resolutions, MOA capital clause alteration, Form SH-7 filing, stamp duty, and ROC fees handled end to end so you can allot new shares without delay.

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What is an Authorized Capital Increase?

Authorized (or nominal) capital is the maximum share capital a company is permitted to issue under the capital clause of its Memorandum of Association. When a company wants to allot shares beyond this ceiling — for fresh funding, a bonus issue, or an ESOP pool — it must first increase its authorized capital under Section 61(1)(a) of the Companies Act, 2013 and notify the ROC in Form SH-7 within 30 days.

The Articles of Association must contain the power to increase capital; if they do not, an AOA amendment is carried out first. The increase itself alters the capital clause of the MOA (see MOA amendment) and attracts ROC fees on the increased slab along with state-specific stamp duty — both of which we compute and pay through the MCA system for you.

When Do Companies Increase Authorized Capital?

Onboarding investors and issuing fresh equity beyond the current ceiling.
Issuing bonus shares by capitalising free reserves.
Creating an ESOP pool for employees and key hires.
Converting loans, debentures, or convertible instruments into equity shares.
Building headroom for a planned rights issue or group restructuring.

Authorized Capital Increase Procedure — Step by Step

Verify that the Articles of Association authorise an increase; amend the AOA first if they do not.
Hold a board meeting to approve the increase and call an EGM.
Pass an ordinary resolution at the EGM altering the capital clause of the MOA.
File Form SH-7 with the ROC within 30 days, paying the differential ROC fee and applicable stamp duty.
The ROC records the increase and the company's master data is updated on the MCA portal.
Proceed with the allotment of new shares and file the return of allotment in Form PAS-3.

Our Authorized Capital Increase Services

AOA Review & Amendment

Checking the enabling clause and amending the articles where the power is missing.

Resolutions & EGM Papers

Board resolutions, EGM notices, and the ordinary resolution drafted and documented.

Form SH-7 Filing

Accurate ROC filing within 30 days with the altered MOA and resolutions attached.

Fees & Stamp Duty

Computation of slab-based ROC fees and state-wise stamp duty on the increase.

MOA Capital Clause Update

Altered capital clause pages prepared for records, banks, and investors.

Allotment Support (PAS-3)

Private placement and rights issue documentation with the return of allotment.

Why Choose The Classic Partners

Fast turnaround — capital increases typically completed within days of the EGM.
Accurate cost computation of ROC fees and stamp duty before you commit.
Seamless link to allotments, valuations, and PAS-3 filings after the increase.
Transparent fees and a dedicated point of contact for promoters.

Frequently Asked Questions

What is the difference between authorized capital and paid-up capital?

Authorized capital is the maximum capital a company can issue as stated in its MOA, while paid-up capital is the amount actually subscribed and paid by shareholders. Paid-up capital can never exceed authorized capital, which is why the ceiling must be raised before large allotments.

Which resolution is needed to increase authorized capital?

An ordinary resolution of the shareholders under Section 61(1)(a) is sufficient, provided the Articles of Association authorise the increase. If the articles are silent, they must first be amended by special resolution under Section 14.

Which form is filed and what is the time limit?

Form SH-7 must be filed with the ROC within 30 days of passing the resolution, along with the altered MOA, the resolution, and the EGM notice. Late filing attracts additional fees.

What are the costs of increasing authorized capital?

Two components apply — slab-based ROC fees on the amount of increase, and stamp duty at rates prescribed by the state where the registered office is situated. Both are paid electronically through the MCA portal at the time of filing SH-7.

Can a company allot shares beyond its authorized capital?

No. Any allotment beyond the authorized capital is invalid. The company must first increase its authorized capital through SH-7 and only then allot the new shares and file the return of allotment in Form PAS-3.

How long does an authorized capital increase take?

Once the EGM is held, the SH-7 filing and ROC approval are usually completed within three to seven working days, after which the increased capital reflects in the company's MCA master data.

Need to increase your authorized capital?

Get the resolutions, SH-7 filing, and stamp duty computation completed quickly and correctly.