The authorized capital of a Company decides the quantity of shares a Company can issue to its shareholders. An increase in authorized capital may be required for issuing new shares and/or enlisting more capital into the Company. The initial authorized capital of the Company is given in the Memorandum of Association of the Company and is usually Rs. 1 lakh. The authorized capital can be increased by the company at anytime with shareholder’s approval and by paying additional charge to the Registrar of Companies.

To start the procedure for increasing authorized capital a determination must be passed by the Board of Directors. In the Board Resolution, authorisation must be accommodated increasing the authorized capital of the company and making the necessary changes to the MOA and AOA of the company.

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