pankaj (CA Final) (381 Points)
25 October 2010hi frnds............. plz ans my question
Q.A company whose share capital is Rs. 100000 divided into 1000 share of Rs. 100 each.it has already raised 500 shares of Rs. 100 each now it wants to issue other 50000 as 5000 shares of Rs. 10 each.
Is it valid as per cos law?
Ajay Mishra
(Company Secretary)
(74337 Points)
Replied 25 October 2010
Hi
It can not increase 50000 as 5000shares @ Rs. 10 because face value of share is Rs. 100. The company can isued shares at premium or discount, but a company can not increase capital with less than face value of share capital unless the face value of the shares is reduced in general meeting.
Regards
K Mohamed Ibrahim
(Company Secretary)
(104 Points)
Replied 27 October 2010
Hi
Company, at the General Meeting may pass the Resolution for reclassification of shares.
Accordingly, Capital clause should be altered in the following manner:
500 shares of Rs.100 each and 5000 shares of Rs.10 each.
Now the Company can issue.
CAclubindia
