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CA Intermediate · Corporate and Other Laws · Share Capital and Debentures

Ananya Industries Ltd, an unlisted public company, wants to alter its memorandum to increase its authorised share capital from Rs 5 crore to Rs 8 crore. The articles permit such alteration. What must the company do under the Companies Act, 2013?

A company authorised by its articles may increase authorised share capital by an ordinary resolution in general meeting. It must file a notice with the Registrar within 30 days. No Tribunal or SEBI approval is required for this alteration.

  1. APass a special resolution and obtain Tribunal approval before filing any form
  2. BPass an ordinary resolution in general meeting and file notice of the alteration with the Registrar within 30 daysCorrect
  3. CObtain only Board approval and inform shareholders by post
  4. DObtain approval from SEBI since capital is being altered

Explanation

If authorised by its articles, a company can increase its authorised share capital by an ordinary resolution in general meeting. It must then file notice with the Registrar within 30 days of the resolution. No Tribunal or SEBI approval is needed for a simple increase, and Board approval alone is not enough.

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