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Breif
The issue of shares is the process by which a company raises capital by allotting its ownership in the form of shares to investors or existing shareholders. It is a key method for companies to fund expansion, attract investors, or strengthen their financial position.
Overview
Shares represent ownership in a company, and issuing them increases the paid-up capital. Companies must follow the Companies Act, 2013, their Articles of Association, and regulatory approvals for issuance. The process involves Board and Shareholders’ resolutions, share subscription, allotment, and filing with MCA (Form PAS-3). Once completed, statutory registers are updated and shareholders receive their share certificates.
Process
Step 1 - Check Articles of Association (AoA) – Ensure the company is authorised to issue new shares.
Step 2 - Convene Board Meeting – Pass a Board Resolution approving the issuance of shares.
Step 2 –Obtain Shareholders’ Approval – Pass an Ordinary or Special Resolution if required.
Step 3 – Decide Share Details – Determine the number, type (equity/preference), face value, and premium (if any).
Step 4 – Allot Shares – Officially issue shares and update the shareholding pattern.
Step 5 – File Form PAS-3 with MCA – Record the allotment and update the paid-up capital in MCA records.
Step 6 – Issue Share Certificates – Provide official certificates to shareholders.
Step 7 – Update Statutory Registers – Update the Register of Members and other statutory records.
Checklist
Details & Documents Required for Increasing Authorised Capital
1. Identity & Address Proofs
- PAN card, Aadhaar, or Passport copies of all directors
- PAN card, Aadhaar, or Passport copies of all shareholders receiving shares
2. Shareholding & Capital Details
- Current Shareholding Pattern
- Proposed shareholding pattern after issuance of shares
3. Share Details
- Number of shares to be issued
- Type of shares (Equity / Preference / Others)
- Face value and premium (if any)
4. Existing Share Certificates (if applicable)
- Copies of already issued share certificates to update records
5. Authorized Director DSC
6. Approvals & Resolutions (prepared by our team)
- Board Resolution approving share issuance
- Shareholders’ Resolution (if required)
- MoA amendment (if increase in authorised capital is needed)
7. ROC Filing (handled by our team)
- Form SH-7 (if authorised capital needs increase)
- Form PAS-3 for recording share allotment
Time Taken
Total Time: Approximately 7–10 working days from the date of receipt of all required documents.
- DSC Verification & Preparation: 1 day
- Increase Authorised Capital (if required) – Form SH-7: 1–2 days
- Drafting Share Allotment Documents – PAS-3: 1–2 days
- Online Filing with MCA – Form PAS-3: 1 day
- ROC Verification & Approval: 3 day
Deliverable
The following deliverables are included in the Biz Silver Plan. Deliverables for other packages may vary accordingly:
- Board Resolution – Approval for the issuance of shares.
- Shareholders’ Resolution (if required) – Ordinary or Special Resolution approving the allotment.
- Share Allotment Details – Finalized number of shares, type, face value, and premium (if any).
- Form PAS-3 Filing – Filed with MCA to record the share allotment and update paid-up capital.
- Share Certificates – Issued to all shareholders receiving shares.
- Updated Statutory Registers – Register of Members and shareholding updated post allotment.
- MCA Confirmation – Official acknowledgment of share allotment and paid-up capital update.
Why Choose Us
Bizeneed makes increasing your company’s paid-up capital fast, hassle-free, and fully compliant. Our expert team handles Board and Shareholders’ resolutions, MoA amendments, SH-7 and PAS-3 filings, and MCA approvals with precision. Entrepreneurs trust us for our timely execution, professional guidance, and end-to-end support, so you can focus on growing your business while we take care of the legal and regulatory process.
FAQs
The issue of shares means allotting company stock to investors or existing shareholders in exchange for capital. It represents ownership in the company.
Private companies, public companies, and Section 8 companies can issue shares, following the Companies Act, 2013 and their Articles of Association.
- To raise funds for business growth or expansion
- To bring in new investors or partners
To improve financial credibility
Yes, the Board must approve, and in most cases, shareholders must pass an Ordinary or Special Resolution.
Yes. Shares can be issued privately to promoters/employees or publicly through an IPO for listed companies.
- Board approves the issuance through a resolution
- Shareholders’ approval is obtained if required
- Share subscription forms are collected from investors
- Allotment is made, and share certificates are issued
- Filing of Form PAS-3 with MCA for private companies
Typically 5–10 working days depending on approvals, type of share, and filings.
PAS-3 is filed with MCA to record the allotment of shares and update paid-up capital.
Yes, shares can be issued at face value or at a premium, subject to compliance with the Companies Act.
Yes, DSC of directors is required for filing PAS-3 and other MCA forms.
- Board Resolution and Shareholders’ Resolution (if applicable)
- Application/Subscription forms from shareholders or investors
- Existing MoA and AoA
Yes, share certificates must be issued to all shareholders receiving shares.
Yes, applicable stamp duty must be paid for share allotment.
Yes, subject to authorised capital limits and compliance with the Companies Act.
Yes, Form PAS-3 must be filed for every allotment to record the increase in paid-up capital.
- Raises funds without taking loans
- Brings in strategic investors
- Strengthens balance sheet and credibility
It is illegal and can attract penalties, fines, or invalidation of the allotment.
Yes, companies can issue Equity Shares, Preference Shares, or Bonus Shares.
Yes, companies can issue shares to employees through Employee Stock Option Plans (ESOPs).
Yes, we assist with statutory compliance, filings, updating registers, and issuing share certificates.