Increase in Authorised Capital

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CA. Vinod Agarwal (Querist)
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06 August 2010 A company has an authorised capital of Rs. 5 Crores which includes Equity Shares of Rs.2 Crores and Redeemable Preferance Shares of Rs. 3 Crores. Now the company wants to redeem the pref. shaares by issue of fresh equity shaares of Rs. 3 Crores. Now, the problem is that whether the company needs to increase its Authorised Capital for issuing equity shares.

Jagruti (CS)

Jagruti (CS) (Expert)
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06 August 2010 It is not mandatory for the Company to increase the Authorised Capital.

In One Meeting you can redeem the preference shares and than reclassify the authorised capital by Ordinary resolution with the approval of members.

File Form 5 for reclassification of autho. capital & redeemotion of pref. shares & Form 2 for the allotment of equity shares.

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