The document that decides whether a share capital change goes quietly is your Articles of Association. If the Articles carry a power to alter capital, an ordinary resolution at a general meeting lifts the authorised figure. If they do not, that resolution is worth nothing. The Articles have to be amended by special resolution first, and only then can the capital clause move. Founders in Bengaluru usually discover this on the morning of a closing, with an investor's counsel waiting on the call. A capital change is really three different jobs: raising the authorised ceiling, allotting shares against it, and reducing capital. Each carries its own form, its own approval and its own Karnataka cost.
Does a capital change apply to your Bengaluru company this year?
It is not an annual filing. Nothing falls due in April and nothing appears on a compliance calendar. The trigger is an event. An investor cheque the authorised ceiling cannot absorb, an ESOP pool with no headroom left, a promoter loan being converted to equity, or a balance sheet that has to be clean before a buyer reads it. Private limited companies, one person companies and section 8 companies are all inside this. An LLP is not, because an LLP has contribution rather than share capital, so SH-7 never reaches it. Small company status and dormant status change nothing. Neither does age. A Bengaluru company incorporated three months ago can raise its authorised capital inside its first financial year, and plenty do, because the figure picked at incorporation was picked to keep incorporation cheap.
Which records have to be clean before anyone touches a form?
The inputs decide the timeline far more than the forms do. Before we open MCA V3 we want five things in front of us.
- The memorandum and Articles as actually filed, not the draft sitting on a founder's laptop, so the capital clause and the alteration power can both be read as they stand.
- The current shareholding share by share, with the register of members reconciled against the last annual return you filed.
- The last AOC-4 and MGT-7, because a capital figure that contradicts your own annual return is the first thing a diligence team finds.
- Directors with a live DSC and DIR-3 KYC completed, since every form here is signed digitally and nothing moves without it.
- Proof of where the money is coming from, because an allotment needs the application money in the company's bank account before the board can allot.
Two Bengaluru points sit alongside that list. The registered office on your master data has to be the address you actually occupy. The Registrar can order a physical verification of a registered office and begin strike off where he believes no business is being carried on. That is a real risk for a company working from a coworking desk. The second point is money. Karnataka's stamp duty head for Articles of Association reads ₹5,000 for every ₹10 lakh or part of share capital, with a ceiling of ₹1 crore. The state component moves with your new figure, so we compute it rather than guess it.
When is the filing due, and how are the thirty days counted?
Thirty days, and the count starts earlier than most people expect. For an increase in authorised capital the clock runs from the date the shareholders pass the resolution. It does not run from the date the amended memorandum is printed, and it does not wait for the investor's money. For an allotment the thirty days run from the date of the board resolution that allots the shares. A board that allots on a Friday and circulates minutes a fortnight later has already spent half its window. Three habits follow from that. Hold the general meeting only when the amended capital clause is ready to file. Do not allot until the application money has landed. And where both steps are needed, sequence them, because the ceiling has to be raised and filed before the shares that need it are allotted.
What does a late capital filing actually cost?
The exposure is daily, which is what makes it dangerous. It does not sit still while you decide what to do about it.
| What goes wrong | What it costs | Where it lands |
|---|---|---|
| SH-7 not filed within thirty days | ₹1,000 for each day the default continues, up to ₹5 lakh | Company and every officer in default |
| PAS-3 not filed within thirty days of allotment | ₹1,000 for each day, up to ₹1 lakh | Company and every officer in default |
| Form filed late but before any notice | MCA additional fee on top of the normal filing fee | Paid on MCA V3 with the form |
| Penalty order already passed | Appeal within sixty days of receiving the order | Regional Director for the South-Western Region at Bengaluru |
A reduction of capital is priced in time rather than in daily exposure. It needs a special resolution and confirmation by the National Company Law Tribunal under section 66. For a company registered in Karnataka that is the NCLT Bengaluru Bench, whose territorial jurisdiction is the state and nothing else. An appeal from its order goes to the NCLAT's Chennai Bench. Nobody rushes a reduction.
Who drafts the resolutions and files your SH-7?
- We read the Articles and the capital clause, confirm which resolution the change needs, and tell you on day one if the Articles themselves have to be amended.
- We draft the board resolution, the general meeting notice with its explanatory statement, and the minutes, keeping to the notice period your own Articles set.
- We compute the Karnataka stamp component and the MCA fee on the new authorised figure, so the number is known before the meeting rather than after it.
- We file SH-7, or PAS-3 on an allotment, on MCA V3 against your director's DSC, and track the SRN until the form is taken on record.
- We hand back the amended memorandum, the updated register of members, share certificates where shares were allotted, and every filed form in one pack.
ROC Bengaluru is the only Registrar of Companies for the whole of Karnataka, and the MCA writes the name both ways, ROC Bengaluru and ROC Bangalore. It shares Kendriya Sadana in Koramangala with the Regional Director for the South-Western Region. The February 2026 restructuring left the registrar's territory untouched, so a company in Whitefield and a company in Chickpet file into the same office, and neither of them needs to go there.
Which Bengaluru companies hit this most often?
- An IT services and staffing company in Whitefield that has signed its first large client and finds the authorised ceiling set at incorporation cannot absorb the round it is closing.
- That same company a year on, creating an ESOP pool for a team that has doubled, where the shares are issued later but the headroom has to exist now.
- A family trading business in Chickpet converting years of promoter loans into equity as it moves from proprietorship habits to a board and a real cap table.
- A company that took the money first and filed afterwards, and now needs the record to survive a buyer's diligence.
- A company writing off accumulated losses before a merger, where the answer is a tribunal confirmed reduction and not a form at all.
What order does a share capital change have to follow?
Capital work is sequencing work. The resolution, the stamp computation, the form and the allotment have to happen in an order that still reads correctly when an investor's lawyer works backwards through it two years later. Our CA and CS team does that sequencing, computes the Karnataka stamp component before the meeting instead of after the form, and files on MCA V3 with ROC Bengaluru. Pricing starts at ₹1,999, with the MCA fee and the state stamp duty billed at actuals. Most authorised capital increases close in 10 to 15 days. For the national picture, read our complete share capital change guide for India. For your own company, send us the Articles and your last annual return, and we will tell you which resolution you need before you call a meeting.