Share application money

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Manikanth (Querist)
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27 February 2014 Can a company receive an amount of share application money in excess of it's Authorised capital ??

If yes, why so??

Sandeep Dharar

Sandeep Dharar (Expert)
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27 February 2014 yes a co. can receive more application money then its authorised capital.

Suppose A ltd has in its Auth. Cap 20000 eq. shares @rs. 100 each i.e, Rs 20,00,000.

Issued & received 20000 eq. shares at Rs 200 each (Rs. 100 premium). i.e, Rs. 40,00,000.

But remember a co. can't issue more shares than its authorised capital. (i.e, 20000 eq. shares only in our example).

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