Increase Authorized Capital
Increase in Authorised Capital
As a company grows, its existing authorised capital may no longer be enough to issue new shares, onboard investors or expand ownership. Increasing the authorised capital gives the company room to raise funds, restructure equity or allot shares without running into statutory limits. The process requires proper resolutions, altered charter documents and MCA filings to keep everything compliant.
What We Assist With
• Assessing the required increase based on future plans
• Drafting Board and shareholder resolutions
• Filing Form SH-7 and MGT-14 with MCA
• Updating MOA and AOA to reflect the revised authorised capital
• Coordination for PAN, GST and bank updates where needed
• Post-approval guidance on further share allotment and filings
Why Companies Increase Authorised Capital
• To raise equity or onboard new investors
• For issuing ESOPs, rights shares or bonus shares
• To support expansion or restructuring
• To avoid delays during future fundraising
• To align capital structure with long-term growth plans
Frequently Asked Questions
1. Why is authorised capital important?
It sets the maximum limit of shares a company can issue. Without increasing this limit, the company cannot allot new shares.
2. Do shareholders need to approve the increase?
Yes. A special resolution at a general meeting is mandatory.
Form MGT-14 for the special resolution and SH-7 for updating the authorised capital.
4. Does the company need to amend its MOA?
Yes. The capital clause in the MOA must be updated to reflect the new authorised capital.
5. How long does the process take?
Usually 3–7 working days once documents are ready and filings are submitted.