Can a unlisted Public company increase its authorised share capital prior to obtaining the Certificate of Commencement of Business?
3 Replies
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 28 May 2013
Yes, it can.
sakshi
(CS)
(261 Points)
Replied 28 May 2013
sir can you explain which sectin says that it can be increased??or can you provide any extrcat from where you are reffering?
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 28 May 2013
As per Section 149 you cannot commence any business as mentioned in Objects clause of Memorandum without getting certificate of commencement of business. Increasing authorised capital is not a normal corporate action and does not amount to 'commencement of business'. Had the company been incorporated with the higher authorised capital, it would not have amounted to commencement of any business.
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