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Company can increase its authorized share capital, only if it is authorized by its Article Of Association and after obtaining approval of members by ordinary resolution.
In accordance with the provisions of Section 61(1) (a) of the Companies Act, 2013, a limited company having a share capital may, if so authorized by its articles, alter its memorandum in its general meeting to increase its authorized share capital by such amount as it thinks expedient.
In order to maintain financial decorum, the government stipulates that no company can indiscriminately issue shares for the purpose of raising capital. To that effect, authorised share capital is the maximum value of share capital that the company is legally authorised to issue to shareholders.
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