How its Possible

860 views 7 replies

CA Navin Jain

MANAGER (FINANCE & ACCOUNTS)

11768 Points Joined June 2008

A company incorporated in sep 2008 with authorised capital of Rs 1,98,00,000 divided into 19,80,000 shares of rs 10 each. members subscribed for 10,00,000 shares in MoA. Now the balancesheet of company is showing paid up capital 99,00,000 divided into 9,90,000 shares.
is it possible that paid up capital can be less than the capital subscribed in MoA at the time of incorporation

Replies (7)

Ajay Mishra

Company Secretary

74352 Points Joined March 2009

As per my understanging, no. of shares shown in MOA will be treated as paid up capital unless further allotment has not been made by company.

Regards

Amit Gupta

Loosening Myself

1508 Points Joined January 2009

Originally posted by : Ajay Mishra
	Hi As per my understanging, no. of shares shown in MOA will be treated as paid up capital unless further allotment has not been made by company. Regards

Amit Gupta

Loosening Myself

1508 Points Joined January 2009

Originally posted by : Ajay Mishra
	Hi As per my understanging, no. of shares shown in MOA will be treated as paid up capital unless further allotment has not been made by company. Regards

Dileep_Matham

Member of GST Team

67 Points Joined May 2010

Rs. 1,00,000/- might be share application money which is not alloted yet !!

Ajay Mishra

Company Secretary

74352 Points Joined March 2009

Dear Dileep

At the time of incorporation, the provisions of share application will not apply, because the company is not in existence.

Regards

Bijendra

Service

31 Points Joined October 2007

Subscribed capital is basically the proceeds that the promoters/shareholders have “agreed” to pay for the shares. The subscribed capital transforms into paid-up capital when the shareholders actually make the cash payment that they agreed to pay.

CS Ankur Srivastava

Company Secretary & Compliance Officer

17858 Points Joined November 2008

No, it is not correct.

In this case, the paid up capital in the balance sheet must be 1 Cr.divided into 10,00,000 shares.

Because in MOA 10,00,000 shares are shown as subscribed. It is considered as deemed allotment. No further formal allotment in this regard is required.