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How to Reduce Authorised & Paid Capital of a Pvt Ltd Company

Ritesh Kumar Batsh (Asst. Accounts Manager) (63 Points)

30 July 2015

hi,

Please advise us complete process for reduction of Authorized & Paid Up capital.

Available Surplus is less then Paid Up capital

Regards

Ritesh

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3 Replies

prakash (Company Secretary) (1352 Points)
Replied 30 July 2015

Dear Ritesh,

The company cann't reduce its authorized capital but it can reduce paid up capital by following procedure laid down and filing petition with high court of concern state and it will take 6 to 9 months time, i advise you to consult company secretary/Advocate for same.

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Ritesh Kumar Batsh (Asst. Accounts Manager) (63 Points)
Replied 30 July 2015

Thanks Prakash,

For Reduction of Paid Up Company can go for Buy Back ?

I Think Company buy back his 25% of paid Up in a Single Financial Year ? is it valid & applicable ?

P C Agrawal (Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad) (8229 Points)
Replied 31 July 2015

Reduction of authorised capital is not possible. Companies Act pr

ovides for following ways of reducing paid up capital:

a) Reduction of capital u/s 100 of CA 1956 with approval of High Court

b) Scheme of arrangement u/s 391-394 of CA 1956 with approval of High Court

c) Buy back of shares u/s 67 of CA 2013

1 Like