A company raises its paid-up capital by issuing new shares, through a rights issue, a private placement, or a preferential allotment. The new shares are allotted within the authorized ceiling and reported to the Registrar in Form PAS-3 within 30 days. Samkhya handles your paid-up capital increase from issue to filing.
Paid-up capital is the capital a company has actually issued and received for its shares, and it rises when the company issues new shares, but only up to its authorized ceiling, so the authorized capital must be increased first if there is no room. New shares are issued under Section 62 of the Companies Act, 2013, most often by a rights issue to existing shareholders (Section 62(1)(a)), a private placement to selected investors (Section 42, via offer letter PAS-4), or a preferential allotment (Section 62(1)(c)). The board and, for a private placement or preferential issue, the shareholders by special resolution, approve the issue; the shares are allotted; and the company files Form PAS-3, the return of allotment, with the Registrar within 30 days. Share certificates follow within two months.
Raising paid-up capital brings real benefits:
Paid-up capital can be raised in several ways:
Issuing new shares involves:
A paid-up increase is used:
Raising paid-up capital starts by confirming there is headroom within the authorized capital, increasing it first if needed. The board approves the issue and its terms, and for a private placement or preferential allotment, the members pass a special resolution (with a valuation report where required and an offer letter in PAS-4). For a rights issue, the offer goes to existing shareholders in proportion, open for a set period. Once acceptances are in, the board allots the shares, and the company files Form PAS-3, the return of allotment, with the Registrar within 30 days, on the MCA V3 portal. Share certificates in Form SH-1 are issued within two months of allotment, and the register of members is updated.
For the Issue:
For the Allotment:
Raising paid-up capital follows a clear sequence:
Raising paid-up capital with Samkhya Corporate Services is simple. Just follow these easy steps:
From there, our team handles the resolutions, offer, allotment, and PAS-3 filing.
Once the shares are allotted:
The government fee for Form PAS-3 is based on the company’s authorized capital, with professional charges separate. A few points need care. First, the issue must stay within the authorized capital, if it does not, the authorized capital is increased first (via SH-7). Second, a private placement or preferential allotment generally needs a valuation report from a registered valuer, and the PAS-3 must be filed within 30 days of allotment, as late filing escalates quickly (around twice the fee within 30 days late, and more thereafter). Third, where shares are issued to a non-resident, FC-GPR is filed under FEMA within 30 days. Following the right route, rights, private placement, or preferential, and filing PAS-3 on time keeps the issue valid and the records clean.
| Feature | Detail |
| Governing Law | Section 62, Companies Act 2013. |
| Main Routes | Rights, private placement, preferential. |
| Key Form | PAS-3, within 30 days. |
| Ceiling | Within the authorized capital. |
| Certificates | Within 2 months of allotment. |
| Portal | MCA V3. |
What is paid-up capital?
Paid-up capital is the capital a company has actually issued and received for its shares, which rises when it issues new shares within its authorized ceiling.
How is paid-up capital increased?
By issuing new shares, through a rights issue, a private placement, or a preferential allotment, and filing Form PAS-3 within 30 days of allotment.
What is a rights issue?
A rights issue offers new shares to existing shareholders in proportion to their holding, under Section 62(1)(a).
What is Form PAS-3?
PAS-3 is the return of allotment filed with the Registrar within 30 days of allotting shares, listing the allottees and the shares issued.
Must the issue be within the authorized capital?
Yes. Shares can only be issued up to the authorized ceiling, so the authorized capital is increased first if there is not enough room.
Is a valuation needed?
A private placement or preferential allotment generally needs a valuation report from a registered valuer; a rights issue to existing shareholders usually does not.
