Can paid up capital be greater than authorised capital

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Roshni Garach (Querist)
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07 March 2013 Dear all
An Indian private company having foreign directors and having low net worth can issue shares at premium or not???? And also tell the maximum limit of premium amount. Is there any litigation against RBI rules & Income Tax rules regarding the issue of shares at premium having low net worth???

Ajay Mishra

Ajay Mishra (Expert)
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08 March 2013 Hi

The capital clause of MOA deal with maximum Authorised Share Capital and Paid Up share Capital of the company.

So, you can not received or maid in excess of that clause.

The share premium amount is the part of reserve and surplus.

In listed company the premium is depend on the price arrived as per SEBI (ICDR) Regulation, 2009 of that shares on relevant date.

Roshni Garach

Roshni Garach (Querist)
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08 March 2013 Thank you Sir
But it is possible to issue shares at premium by a company(not listed) having low net worth??

Ajay Mishra

Ajay Mishra (Expert)
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08 March 2013 Yes, you can issue at premium.

Roshni Garach

Roshni Garach (Querist)
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08 March 2013 Thank you very much sir
Actually the foreign directors about whom i am talking are scared about the future penalty or litigation(if any)So will you please tell me that is there any prohibition of any section of company law or RBI rules because they are investing in india in foreign currency.

Ajay Mishra

Ajay Mishra (Expert)
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08 March 2013 Go to the following link, it may help you:

https://www.caclubindia.com/articles/note-on-foreign-direct-investment-in-india-13412.asp

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