Change Authorized Capital
Before a company can issue more shares than its current authorised limit allows, that limit itself has to be increased — and filed with the Registrar.
Authorised share capital is the maximum value of shares a company is permitted to issue, as stated in its Memorandum of Association. To increase it, the company needs enabling authority in the AOA, an ordinary resolution passed at a general meeting, and a filing of Form SH-7 with the Registrar within 30 days of the resolution, along with the altered capital clause of the MOA.
What's included
From checking the AOA to the completed SH-7 filing.
- Checking whether the AOA permits a capital increase
- Drafting the board and ordinary resolution
- Altering the capital clause of the MOA
- Filing Form SH-7 within 30 days of the resolution
- Updating the company's authorised capital on the MCA master data
- Coordinating a subsequent share allotment, if planned
Why companies increase authorised capital
The common reasons this comes up.
Fresh Fundraising
Issuing new shares to investors often requires headroom beyond the current authorised limit.
Bonus Issue or ESOP Pool
Allotting bonus shares or setting aside an ESOP pool can require additional authorised capital.
Debt-to-Equity Conversion
Converting outstanding loans into equity may need the authorised capital increased first.
Our process
From initial consultation to completion.
Check the AOA
Confirm the Articles permit an increase, or amend them first if not.
Pass the Resolution
Ordinary resolution at a general meeting approving the increase.
File Form SH-7
Submit the filing with the altered MOA capital clause within 30 days.
Proceed to Allotment
Once approved, proceed with any planned share issuance.
Why this filing needs to happen before allotment
What sets our approach apart.
Paid-up capital can't exceed authorised capital
Any share allotment beyond the current authorised limit is invalid until the limit itself is raised.
Stamp duty implications
Some states levy additional stamp duty on the increased authorised capital, which needs to be budgeted for.
30-day filing window
SH-7 must be filed within 30 days of the resolution, with additional fees applying after that.
Change Authorized Capital questions answered
What people ask before engaging us.
Planning to raise your authorised capital?
We'll handle the resolution, MOA update and SH-7 filing.
