DECREASE THE FACE VALUE OF SHARE

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Querist : Anonymous

Querist : Anonymous (Querist)

23 March 2011 FACE VALUE OF EQUITY SHARE OF A PRIVATE COMPANY IS RS 10 WE WANT TO DECRASE THE FACE VALUE TO RS 1. WHAT IS THE PROCEDURE AND WHICH FORM WE NEED TO FILE WITH ROC.

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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23 March 2011 Procedures:

*Convene a Board Meeting for the purpose of
passing resolution for the sub-division of shares.

*At the Board meeting, the given decisions must be taken:-
a. approving the proposal for sub-division of shares and consequential alteration of the memorandum;
b. convening a general meeting for passing an ordinary resolution in terms of section 94 and a special resolution if the subdivision of shares calls for alteration of articles;
c. fixing a date, place and time of the meeting and to approve the draft notice of the general meeting and explanatory statement; and
d. authorising a Company Secretary (or a director or other officer) of the company to issue the notice to the members.

* Convene a General Meeting to pass a resolution ordinary/special resolution for the subdivision of shares and the memorandum and articles of the company.

* File FORM NO. 23 with Registrar of Companies alongwith the requisite filing fees, alongwith the certified copy of the a special resolution and the explanatory
statement passed at the general meeting, within 30 day of the conclusion of the meeting.

* File Form No.5 for sub-division of shares along with certified copy of the special resolution passed at the general meeting.

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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23 March 2011 Draft AGM/EGM Resolution:

SUBDIVISION OF EQUITY SHARES.

RESOLVED that pursuant to the provisions of Section 94 and other applicable provisions, if any, of the Companies Act, 1956 and the provisions of Article _ of the Articles of Association of the Company and subject to the approvals, consents, permissions and sanctions as may be necessary from the appropriate authorities or bodies, each of the _______equity shares of the face value of Rs.10/- each in the authorised share capital of the Company be sub-divided into _______ equity shares of Rs. __/- each and Clause V of the Memorandum of Association and Article __of the Articles of Association of the Company be altered accordingly.

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Querist : Anonymous

Querist : Anonymous (Querist)

23 March 2011 THANKS SANJAY SIR,
One thing I want to add with is wrongly at the time of formation of company share holders subscred Rs 1 crore insted of Rs 10 Lakh. So we think we will decrese the facce value. So is the procedure is correct?