Company · Money in
We want to reduce capital or cancel shares — how does that work?
The short answer
Reducing capital or cancelling shares is not a board-level tweak — it needs a special resolution and NCLT confirmation under Section 66, with creditors represented in the process. Once the Tribunal or Central Government order takes effect, you file INC-28 within 30 days and MGT-14 within 30 days of passing the resolution. If you mainly want to return money to shareholders, a buyback under Section 68 is often the lighter route.
The paperwork nobody tells you about
Statutory formats that never touch the MCA portal — but an ROC inspection or due diligence will ask for every one of them.
Capital reduction is Tribunal-driven: special resolution, then NCLT confirmation with creditor representation
Section 66, Companies Act 2013
The sequence
- 1Pass a special resolution approving the capital reduction
- 2File MGT-14 within 30 days of passing the resolution
- 3File the NCLT petition and complete the creditor representation process
- 4Obtain NCLT or Central Government confirmation and let the order become effective
- 5File INC-28 within 30 days of the order becoming effective
Do it with us — or check it yourself first
Questions founders actually ask
Can we just cancel shares by board resolution?
No. Capital reduction is Tribunal-driven under Section 66 — it requires a special resolution and NCLT confirmation with creditor representation. It is not a routine board action.
What if we mainly want to return cash to shareholders?
A buyback under Section 68 is often the lighter alternative for returning money. Capital reduction is the heavier Tribunal route when you are restructuring or cancelling share capital itself.
When do we file with the ROC after NCLT approval?
File INC-28 within 30 days of the NCLT or Central Government order becoming effective. MGT-14 for the special resolution is due within 30 days of passing that resolution.
Last verified 2026-08-24 against MCA V3 records and ICSI reference material. Form-level deadlines and penalties live on the linked form pages and update there.