ALTERATION OF SHARE CAPITAL.pptx SLIDESHARE
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ALTERATION OF SHARE CAPITAL.pptx
![ Where the Government has, by an order, directed that
any debenture or loan or any part thereof shall be
converted into shares in a company and where no appeal
has been preferred to the Tribunal or where such appeal
has been dismissed, the memorandum of such company
shall, where such order has the effect of increasing the
authorized share capital of the company, stand altered
and the authorized share capital of such company shall
stand increased by an amount equal to the amount of the
value of shares which such debentures or loans or part
thereof has been converted into. [Section 62(6)].
This Section 62(6) is yet to be notified.
Where appeal is dismissed or not
preferred](https://image.slidesharecdn.com/alterationofsharecapital-250804060034-360778bd/85/ALTERATION-OF-SHARE-CAPITAL-pptx-SLIDESHARE-4-320.jpg)
ALTERATION OF SHARE CAPITAL.pptx SLIDESHARE
- 1. DR.D.SAMUNDEESWARI ASSISTANT PROFESSOR SRI RAMAKRISHNA COLLEGE OF ARTS & SCIENCE, COIMBATORE ALTERATION OF SHARE CAPITAL
- 2. Section 64(1) states that when— (a) a company alters its share capital u/s 61(1); or (b) an order made by the Government has the effect of increasing authorized capital of a company; or (c) a company redeems any redeemable preference shares Alteration of Share Capital
- 3. where the terms and conditions of such conversion are not acceptable to the company, it may, within sixty days from the date of communication of such order, appeal to the Tribunal which shall after hearing the company and the Government pass such order as it deems fit. Appeal against Govt. Order
- 4. Where the Government has, by an order, directed that any debenture or loan or any part thereof shall be converted into shares in a company and where no appeal has been preferred to the Tribunal or where such appeal has been dismissed, the memorandum of such company shall, where such order has the effect of increasing the authorized share capital of the company, stand altered and the authorized share capital of such company shall stand increased by an amount equal to the amount of the value of shares which such debentures or loans or part thereof has been converted into. [Section 62(6)]. This Section 62(6) is yet to be notified. Where appeal is dismissed or not preferred
- 5. S.N O BASIS SHARES STOCKS 1 Distinct No. Shares in physical form bear distinct numbers. Stocks are the consolidated value of share capital 2 Fully Paid up Shares may or may not be fully paid up Stock is always fully paid-up 3 Nominal Value Shares have a nominal value. Stock does not have any nominal value. 4 Denomination All shares are of equal denomination. Denomination of stocks varies. 5 Fractional value It is not possible to transfer shares into fraction. Stock is divisible and transferable into any fractional value. Difference between shares & Stocks
- 6. S.n Basis Alteration of shares Reduction of shares 1 Applicability Applicable section 61 of the Companies Act, 2013. Applicable section 66 of the Companies Act, 2013. 2 Resolution Alteration of share capital is required to be done by ordinary resolution. Reduction of share capital is required to be done by special resolution 3 Confirmation Alteration of share capital is not required to be confirmed by the Tribunal. Reduction of share capital is to be confirmed by the Tribunal. 4 Ways (a) Increasing its nominal capital by issuing new shares. (b) Consolidating share capital into shares of large denomination. (c) Converting fully paid up shares into stock or vice (a) Extinguishing or reducing the liability of members in respect of the capital not paid up. (b) Paying off any paid up share capital which is in excess of the needs of the company. Difference in Alteration of share capital and reduction of share capital
- 7. “Surrender of shares” means the surrender to the company by the registered holder of shares already issued. 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 favor of the company and amount to a reduction of capital. REDUCTION OF SHARE CAPITAL
- 8. A company may if authorized by its articles, forfeit shares for non-payment of calls and the same will not require confirmation of the Tribunal. Where power is given in the articles, it must be exercised strictly in accordance with the procedure stated therein, otherwise the forfeiture will be void. Forfeiture will be effected by means of Board resolution. Forfeiture of shares
- 9. The creditors having a debt or claim admissible in winding up are entitled to object. To enable them to do so, the Court will settle a list of creditors entitled to object. If any creditor objects, then either his consent to the proposed reduction should be obtained or he should be paid off or his payment be secured. Consent of creditors
- 10. If the Court is satisfied that either the creditors entitled to object have consented to the reduction, or that their debts have been paid or secured, it may confirm the reduction. The Court may also direct that the words “and reduced” be added to the company’s name for a specified period, and that the company must publish the reasons for the reduction. Confirmation and Registration of reduction of share capital
- 11. The Court’s order confirming the reduction of the company’s share capital, should be delivered to the ROC. The reduction takes effect only on registration of the order, and not before. The Registrar will then issue a certificate of registration which will be a conclusive evidence that the requirements of the Act have been complied with. Conclusiveness of certificate for reduction of capital