Ways of reducing paid up share capital of the company
This query is : Resolved
25 November 2014
Pls provide me the ways of reduction of paid up share capital of the company
27 November 2014
1. Surrender of Shares-It means the surrender of shares already issued to the company by the registered holder of shares. Where shares are surrendered to the company, whether by way of settlement of a dispute or for any other reason, it will have the same effect as a transfer in favour of the company and the amount to a reduction of capital.
The Companies Act contains no provision for Surrender of Shares. Thus surrender of shares is valid only when Articles of Association provide for the same and:
A. Where forfeiture of such shares is justified
B. When shares are surrendered in exchange for new shares of same nominal value.
2. Forfeiture of Shares – A company may if authorized by its articles, forfeit shares for non-payment of calls and the same will not require confirmation of the court. Where power is given in the Articles, it must be exercised strictly in accordance with the regulations regarding notice, procedure and manner stated therein; otherwise the forfeiture will be void. Forfeiture will be affected by means of Board resolution.
3.Buy back of its own shares
4.Redemption of redeemable preference shares
The Companies Act contains no provision for Surrender of Shares. Thus surrender of shares is valid only when Articles of Association provide for the same and:
A. Where forfeiture of such shares is justified
B. When shares are surrendered in exchange for new shares of same nominal value.
2. Forfeiture of Shares – A company may if authorized by its articles, forfeit shares for non-payment of calls and the same will not require confirmation of the court. Where power is given in the Articles, it must be exercised strictly in accordance with the regulations regarding notice, procedure and manner stated therein; otherwise the forfeiture will be void. Forfeiture will be affected by means of Board resolution.
3.Buy back of its own shares
4.Redemption of redeemable preference shares
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- TDS on Consultancy- Non DTAA
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
- Reopen of assessment proceeding
- Depreciation of fixed assets- coop housing society in mumbai
- EPF FULL & FINAL RULES IN 2026
- GST rate and HSN code for sale of racing horses
- Rental income gst and it purpose
- Eway bill generation from place other than registeted
- TDS Return Q1 FY 2026-27
- DIN reactivation
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- STATUTORY AUDIT OF A SMALL PRIVATE COMPANY INCORPORATED ON 28.03.2025
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
- Resigning a auditor from the company for misconduct
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
- CALCULATION OF DEFFERED TAX - OP BL IS DTL & CURRET IT DTA
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
