Share capital increase after share issue

Others 440 views 3 replies

Kamal Pal

Dy. Mgr. Accounts

128 Points Posted on 23 November 2021

issued shares from paid up capital without checking the authorized capital along with paid up and differential right shares size mentioned in MOA now CS asks to increase authorised capital to resolve. My query here is if we should file increase in current year or do it back dated?

Note - share issued in f.y 2020-21

This is an urgent query as needed to disclose in audited statement and auditor report before avm 30.11.2021.

Replies (3)

CA Raj Doshi

Practising CA

8954 Points Posted on 23 November 2021

You have to choose

Either shareholders and directors of a family owned business consent for "Share Application pending allotment" or file the actual allotment details with "Late Fees"

Kamal Pal

Dy. Mgr. Accounts

128 Points Posted on 24 November 2021

Thanks for responding, Sir, actually shares are already issued to mr. x but CS did not check the revised MOA of 2010 under which 75k share issued with voting rights and 20k share issued on differential rights, while 100 shares issued in the year with voting rights in addition to 75.1k (75k+100) without taking in the consideration that 100 shares can not be issued from 20000 shares.

Now CS provided a solution to increase authorized capital from 9.50 lacs to 9.51 lac or extra to cover the gap and if we should increase the share capital in current year or file it back dated (which is time and additional money consuming).

Please reply.

Chirag

Professional

1979 Points Posted on 27 November 2021

Please elaborate your query with proper facts ,
By the way if shares are increasing due to conversion/new issue and current authorised capital is insufficient then you have to first increase authorised capital u/s 61 and by altering Capital clause in MOA ,