Alteration of Capital clause of MOA

This query is : Resolved

Deepika Bhardwaj (Querist)
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10 February 2009 Dear Professionals

Pls help me in solving the following Query:

Present Authorised share capital of a company is Rs. 10 Crores consisting of 1 cr Equity shares of Rs.10 each.
& Issued and paid up equity share capital consist of 50 lacs equity shares of Rs.10 each.

Company wants to issue Preference shares. and for this purpose capital clause of the MOA & AOA needs to be altered.

If co. cancels its unissued equity capital pursuant to sec 94(1)(e) and simultaneously add prefernce share capital in the capital clause of MOA with same amount so that authorised share capital remains same.

Can company do so? and if yes what will be the procedure?

thanks & regards
CS. Deepika Bhardwaj

CA. B.SRINIVASULU

CA. B.SRINIVASULU (Expert)
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10 February 2009 Yes, you can alter the memordum at a time for both the things.

Step 1 : Conduct a Board meeting

Step 2 : In the board meeting bring the subject for reduction / cancellation of share capital and reasons for the same.

Step 3 : In the same board meeting bring the subject for increase in preference share captial.

Step 4 : Pass a resolution for the same.

Step 5 : Conduct EGM or bring the same subjects in AGM under special resolution.

Step 6 : Get the permission of the shareholders.

Step 7 : Based on the permission change the memordum and articles of asscoiation in the immediate boardmeeting after egm or agem.

Step 8 : File form 23 to Roc under companies act along with the revised memorandum and articles of association

Step 9 : you will get a confirmation from roc within 10days of filing form 23 accepting the changes in the memorandum and articles.

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