CS DIVESH GOYAL

Practicing Company Secretary

GOYAL DIVESH& ASSOCIATES

Mob: +918130757966
csdiveshgoyal@gmail.com

ALTERATION IN CAPITAL

CLAUSE UNDER COMPANIES ACT- 2013

GOYAL DIVESH & ASSOCIATES, PRACTICING COMPANY SECRETARY

GOYAL DIVESH & ASSOCIATES, Practicing Company Secretary

ALTERATION IN CAPITAL CLAUSE,

CLAUSE,

SERIES

Section 13 read with rule 29 of Companies

NO- 49

(Incorporation) Rules, 2014

Series1
Series1 49
Every business run on finance and share capital is base finance; hence Finance is life blood of
a company. Section 13 of Companies Act 2013 regulates the process of amendment in
Memorandum of Association is applicable to all companies. All clauses of Memorandum except
Capital clause can be altered by following the provisions of Section 13 of Companies Act, 2013
by passing special resolution.
Under Companies Act, 2013, the process of Increase in Authorize Capital is governed by
Section 61 read with Section113 and 64 of Companies Act, 2013.
Where any communication or publication of a company contains a statement of the amount of
the authorize capital of the company, it shall also contain a statement in an equally prominent
position and in equally conspicuous characters of the amount of the capital which has been
subscribed and the amount paid up.
Section 61 (1) of the act states that a limited company having a share capital, if so authorized
by its articles , alter the conditions of its memorandum to increase its share capital by such
amount as it thinks expedient by issuing new shares.
Furthermore section 14(1) of the act states that the articles of company can be altered by a
special resolution if so allowed by the memorandum of the company.

CS DIVESH GOYAL
Practicing Company Secretary
GOYAL DIVESH& ASSOCIATES

Mob: +918130757966
csdiveshgoyal@gmail.com

STEPS OF INCEREASE IN AUTHORIZE CAPITAL (Section1

(Section1 13 & 61)
There are two way of Increase in Authorize Capital:
1) If there is no requirement to Alteration in Article of Association.
2) If there is require to Alter Article of Association.

1) 1 If there is No requirement of Alteration in Article of Association

First Check is there any provisions in Article of Association regarding increase in capital, if
there is provision in AOA then no need for alteration in Article of Association.
STEP: I
Call Meeting of Board Director:

Issue Notice of Board Meeting to all the directors of company at least 7 days before
the date of Board Meeting.

Attach Agenda of Board Meeting along with Notice.
STEP: II
II
Hold the Board Meeting:
At the Board meeting, the given resolutions must be passed:1

Get Approval to Increase in the authorized capital and recommending the proposal for
members' consideration by way of ordinary resolution.

Fixing the date, time, and venue of the general meeting and authorizing a director or
any other person to send the notice for the same to the members.

Approval of Notice of EGM.

Provisions of the Section 101 of the Companies Act 2013 provides for issue of notice of
EGM in writing to below mentions atleast 21 days before the actual date of the EGM :
 All the Directors.
 Members
 Auditors of Company

CS DIVESH GOYAL
Practicing Company Secretary
GOYAL DIVESH& ASSOCIATES

Mob: +918130757966
csdiveshgoyal@gmail.com

The notice shall specify the place, date, day and time of the meeting and contain a
statement on the business to be transacted at the EGM.

Authorize Director & Company Secretary of company to issue notice of EGM.
STEP1
STEP1III
III
Hold Extra Ordinary general Meeting::

Check the Quorum.

Check whether auditor is present, if not. Then Leave of absence is Granted or Not. (As
per Section1 146).

Pass the Ordinary Resolution (u/s1 61(1)(a) of the companies act, 2013) for change in
Capital Clause of Memorandum of Association of Company.

Approval of Alteration in MOA & AOA.
STEP1
STEP1IV
FILING AND FEES::
I) File FORM NO. SH17 (Section164(1) read with Rule 15 of The Companies (Share Capital
and Debentures) Rules, 2014 )within 30 days of passing the Ordinary resolution, along
with given documents:1
 Certified True Copies of the Ordinary Resolutions along with explanatory
statement;
 Copy of the Notice of meeting send to members along with all the annexure;
 A printed copy of the Altered Memorandum of Association and Article of
Association.
 Minutes of General Meeting.
STEP1
STEP1V
Concerned Registrar of Companies (ROC) will check the E1form and attached the documents
and will approve the increase in Authorize capital of company.

CS DIVESH GOYAL
Practicing Company Secretary
GOYAL DIVESH& ASSOCIATES

Mob: +918130757966
csdiveshgoyal@gmail.com

21 If there is requirement of Alteration in Article of Association

First Check is there any provisions in Article of Association regarding increase in capital, if
there is no provision in AOA then first requires alteration in Article of Association.
STEP: I
CALL BOARD MEETING:

To Alter the Clause in Article of Association of Company for Increase in Authorize
Capital of Company.

To alter the Capital clause in memorandum of association of Company By giving Notice
of at least 7 days.
STEP: II
II
CALL BOARD MEETING
At the Board meeting, the given resolutions must be passed:1

Get Approval for alteration in Article of Association

Get Approval to Increase in the authorized capital and recommending the proposal for
members' consideration by way of ordinary resolution.

Fixing the date, time, and venue of the general meeting and authorizing a director or
any other person to send the notice for the same to the members.

Provisions of the Section 101 of the Companies Act 2013 provides for issue of notice of
EGM in writing to below mentions atleast 21 days before the actual date of the EGM :
 All the Directors.
 Members
 Auditors of Company

The notice shall specify the place, date, day and time of the meeting and contain a
statement on the business to be transacted at the EGM.
STEP1
STEP1III
HOLD A GENERAL MEETING:

Check the Quorum.

CS DIVESH GOYAL
Practicing Company Secretary
GOYAL DIVESH& ASSOCIATES

Mob: +918130757966
csdiveshgoyal@gmail.com

Check whether auditor is present, if not. Then Leave of absence is Granted or Not. (As
per Section1 146).

Pass the Special Resolution for change in Capital Clause of Article of Association and
Memorandum of Association of Company.

Approval of Alteration in MOA & AOA.

STEP1
STEP1IV
FILING AND FEES:
I) File FORM NO. MGT114 (Filing of Resolutions and agreements to the Registrar under
section 117) with the Registrar along with the requisite filing within 30 days of passing the
special resolution, along with given documents:1
 Certified True Copies of the Special Resolutions along with explanatory statement;
 Copy of the Notice of meeting send to members along with all the annexure;
 A printed copy of the Altered Article of Association and Memorandum of
Association.
2) File FORM NO. SH17 (Section164(1) read with Rule 15 of The Companies (Share Capital
and Debentures) Rules, 2014 )within 30 days of passing the Ordinary resolution, along
with given documents:1
 Certified True Copies of the Ordinary Resolutions along with explanatory
statement;
 Copy of the Notice of meeting send to members along with all the annexure;
 A printed copy of the Altered Memorandum of Association and Article of
Association.
 Minutes of General Meeting.
STEP1
STEP1V
Concerned Registrar of Companies (ROC) will check the E1form and attached the documents
and will approve the increase in Authorize capital of company.

CS DIVESH GOYAL
Practicing Company Secretary
GOYAL DIVESH& ASSOCIATES

Mob: +918130757966
csdiveshgoyal@gmail.com

(Author CS Divesh Goyal, GOYAL DIVESH & ASSOCIATES Company Secretary in Practice
from Delhi and can be contacted at csdiveshgoyal@gmail.com) Disclaimer: The entire contents of
this document have been prepared on the basis of relevant provisions and as per the information
existing at the time of the preparation. Though utmost efforts has made to provide authentic
information, it is suggested that to have better understanding kindly cross-check the relevant
sections, rules under the Companies Act, 2013. The observations of the author are personal view
and the authors do not take responsibility of the same and this cannot be quoted before any
authority without the written

SAMPLE BOARD RESOLUTION FOR:

Increase in Authorised Share Capital
RESOLVED THAT pursuant to the provisions of Section 61 and 64 and other applicable
provisions, if any, of the Companies Act, 2013 (including any amendment thereto or re1
enactment thereof) and the rules made there under, the consent of the Board of Directors of
the Company be and is hereby accorded, subject to the approvals of shareholders in the
General meeting, to increase the Authorized Share Capital of the Company from existing Rs.
50,00,000 (Rupees Fifty Lacs) divided into 5,00,000 (Five Lacs) Equity Shares of Rs. 10/1 each to
Rs. 75,00,000 (Rupees Seventy Five Lacs) divided into 7,50,000 (Seven Lacs Fifty Thousand)
Equity Shares of Rs. 10/1 each by creation of additional 2,50,000 (Two Lacs Fifty thousand)
Equity Shares of Rs. 10/1 each ranking pari passu in all respect with the existing Equity Shares
of the Company.
Alteration in the Capital Clause of Memorandum of Association
RESOLVED THAT pursuant to the provisions of Section 13, 61 and 64 and other applicable
provisions of the Companies Act, 2013 (including any amendment thereto or re1enactment
thereof) and the rules framed there under, the consent of the Board of Directors of the
Company be and is hereby accorded, subject to the approvals of shareholders in the General
meeting, for substituting Clause V of the Memorandum of Association of the Company with the
following clause.

CS DIVESH GOYAL
Practicing Company Secretary
GOYAL DIVESH& ASSOCIATES

Mob: +918130757966
csdiveshgoyal@gmail.com

V. The Authorised Share Capital of the Company is Rs. 75,00,000/1 (Rupees Seventy Five Lacs)
divided into 7,50,000 (Seven Lacs Fifty Thousand) Equity Shares of face value of Rs. 10/1
(Rupees Ten) each.
Sample Shareholders Resolution to be passed in the General Meeting:
INCREASE IN AUTHORISED SHARE CAPITAL AT GENERAL MEETING
Special Business
To consider, and if thought fit, to pass with or without modification(s), the following resolution
as an Ordinary Resolution:
RESOLVED THAT pursuant to the provisions of Section 61 read with Section 64 and other
applicable provisions, if any, of the Companies Act, 2013 (including any amendment thereto or
re1 enactment thereof) and the rules framed there under, the consent of the members of the
Company be and is hereby accorded to increase the Authorized Share Capital of the Company
from existing Rs. 50,00,000 (Rupees Fifty Lacs) divided into 5,00,000 (Five Lacs) Equity Shares
of Rs. 10/1 each to Rs. 75,00,000 (Rupees Seventy Five Lacs) divided into 7,50,000 (Seven Lacs
Fifty Thousand) Equity Shares of Rs. 10/1 each by creation of additional 2,50,000 (Two Lacs
Fifty Thousand) Equity Shares of Rs. 10/1 each ranking pari passu in all respect with the
existing Equity Shares of the Company.
Alteration in the Capital Clause of Memorandum of Association
To consider, and if thought fit, to pass with or without modification(s), the following resolution
as an Ordinary Resolution:;
RESOLVED THAT pursuant to the provisions of Section 13, 61 and 64 and other applicable
provisions of the Companies Act, 2013 (including any amendment thereto or re1enactment
thereof) and the rules framed there under, the consent of the members of the Company be and
is hereby accorded for substituting Clause V of the Memorandum of Association of the
Company with the following clause.

CS DIVESH GOYAL
Practicing Company Secretary
GOYAL DIVESH& ASSOCIATES

Mob: +918130757966
csdiveshgoyal@gmail.com

V. The Authorised Share Capital of the Company is Rs. 75,00,000/1 (Rupees Seventy Five Lacs)
divided into 7,50,000 (Seven Lacs Fifty Thousand) Equity Shares of face value of Rs. 10/1
(Rupees Ten) each.

(Author CS Divesh Goyal, GOYAL DIVESH & ASSOCIATES Company Secretary in Practice
from Delhi and can be contacted at csdiveshgoyal@gmail.com) Disclaimer: The entire contents of
this document have been prepared on the basis of relevant provisions and as per the information
existing at the time of the preparation. Though utmost efforts has made to provide authentic
information, it is suggested that to have better understanding kindly cross-check the relevant
sections, rules under the Companies Act, 2013. The observations of the author are personal view
and the authors do not take responsibility of the same and this cannot be quoted before any
authority without the written