Payment from paid up Capital

This query is : Resolved

PREMNATH (Querist)
Follow

22 January 2021 Sir
Can I use paid up Capital of a Private Ltd Company for paying expenses like fine for not filing GST Nil returns on time.
Thanks

CA Rashmi Gandhi

CA Rashmi Gandhi (Expert)
Follow

22 January 2021 Yes you can . Once, the capital is subscribed, the company is free to spend on its business activities ( payment of Incorporation fees, advertisement, salary & etc), there is no compulsion under any act to restrict the spending of the company.

Jatin Bajaj

Jatin Bajaj (Expert)
Follow

23 January 2021 Yes, once the amount is received by the Company and necessary filing is done in ROC, the amount of paid-up capital may be used for managing the business expenses of the Company