Is ordinary resolution enough at EGM to increase the authorised capital of a company?
There is an option at Form SH 7 (Form for alteration of share capital) for ordinary resolution too.
Please provide a solution with explanation..........
SIVARAMAKRISHNAN P.G (CA final student) (129 Points)
10 September 2014Is ordinary resolution enough at EGM to increase the authorised capital of a company?
There is an option at Form SH 7 (Form for alteration of share capital) for ordinary resolution too.
Please provide a solution with explanation..........
CS Mitesh Mehta
(Company Secretary)
(17139 Points)
Replied 10 September 2014
Yes.
Ordinary Resolution, for amendment in authorised share Capital clause of Memorandum of Association is sufficient.
Amendment in Memorandum of Association by way of passing Special Resolution is required only when there is a change in particular clause of MOA like alteration in name clause or alteration in registered office clause, as envisaged in Section 13.
Amendment in capital clause of Memorandum of Association for the purpose of increase in authorised share capital is exclusively governed by Section 61of the Companies Act, 2013 and section 61 is silent about the nature of shareholders’ resolution. So in the above scenario an Ordinary Resolution would be enough for increase in authorised share capital.
Vandana J Doshi
(Practising Company Secretary)
(12562 Points)
Replied 11 September 2014
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