Question

Who sets the limit of authorized capital for any company?

Answer 1

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minimum amount of capital, which:

a. For private limited companies and OPCs is Rs. 1 lakh;

b. and for public limited companies is Rs. 5 lakh.

2. Such capital is first decided at the beginning of the firm’s incorporation.

3. As the amount of authorized capital increases, so will the ROC fee.

4. Even after the incorporation of the company, the authorized capital can be changed at any point of time.

5. This is no way means that a person owes such an amount to anyone.

6. This capital is not liable for use to calculate the net worth of the company.

7. As mentioned earlier, it is the limit to which a firm can issue shares. One can issue shares less than the authorized capital too. You can check the fee related to such a capital at the MCA portal.

Start-ups tend to register their companies with the minimum authorised capital, as the fees for incorporation are tied to the amount authorised. But some companies do incorporate with authorised capital much larger than current requirements so that they don’t have to inform the RoC when they want to raise more money. However, even if there is an increase in paid-up capital, the RoC must be informed.

Answer 2

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➡️ Authorised Capital : 1 Lakh

Minimum Authorised Capital for starting a Pvt Ltd Company is Rs. (INR) 100,000/- Govt Fees (Ministry of Corporate Affairs) is Rs. (INR) 5000/-

➡️ Authorised Capital : 1–5 Lakh

Authorised Capital Over&Above One Lakh : Rs. (INR) 4,000 per every additional lakh of Authorised capital.

➡️Authorised Capital : 5–50 Lakh

For every additional One Lakh Authorised Capital : Govt Fees is Rs.3,000 per every additional lakh to Authorised capital