Capital structure
Increase Authorised Capital - SH-7 Filing Process
An authorised capital increase creates room for future share issuance, option grants, or fundraising, and SH-7 is the form that tells the ROC the cap table ceiling has changed.
Authorised capital is not the same thing as paid-up capital. If the company needs more room to issue shares for fundraising, ESOP allocation, or internal restructuring, the authorised capital ceiling has to move first. We prepare the SH-7 filing sequence, review the resolution path, and calculate the fee based on the new capital band so the filing can be submitted without a last-minute reconciliation problem.
- • Resolution path review
- • SH-7 filing preparation
- • Capital band fee calculation
- • MOA alteration support where needed
- • Post-filing data update checklist
- • ROC follow-up if the filing is queried
- • Board and shareholder resolutions
- • Current and proposed authorised capital details
- • Updated MOA where required
- • CIN and company master data
- • Filing signatory and DSC details
- • Any related approval documents
See the fee table below for the statutory filing charge and common delay logic.
- • Companies Act, 2013 section 61(1)(a)
- • SH-7 notice of alteration of share capital
- • Companies (Registration Offices and Fees) Rules, 2014 fee bands
Process
How the service works
The workflow is built to be predictable: document collection, legal review, filing, and post-filing follow-through.
Check why the capital needs to change
We first confirm whether the increase is needed for fundraising, ESOP room, a conversion, or a broader restructuring so the resolution path is not overbuilt or underbuilt.
Prepare the resolution and the SH-7 data
The filing needs the approved increase amount, the updated capital ceiling, and the supporting company approvals that authorize the change.
Calculate the filing fee correctly
The SH-7 fee is based on the increased authorised capital. For an increase, the rules require the difference between the fee on the new capital and the fee on the existing capital.
File and update the company record
Once submitted, the change should be reflected across the company records so later allotments, ESOP grants, or funding events do not hit a capital ceiling issue.
AEO summary
Increase authorised capital in India is usually done under section 61(1)(a) of the Companies Act, 2013 by passing the required resolution and filing SH-7 with the Registrar along with the appropriate fee calculated from the new authorised capital level.
Authorised capital vs paid-up capital
A lot of founders use these terms interchangeably, but they are different. Authorised capital is the ceiling the company is allowed to issue under its charter, while paid-up capital is the amount actually issued and paid for by shareholders.
If the company wants to issue more shares, it must have enough authorised capital headroom. That is why the increase is usually done before a funding close, a large ESOP grant, or a conversion event that would otherwise hit the cap.
From a process perspective, the change is about preparing the ceiling for future issuance. The company is not necessarily issuing new shares immediately; it is making room to do so later without a bottleneck.
- • Paid-up capital cannot exceed the authorised ceiling.
- • The cap table should be updated after the form is processed.
- • The approval path should reflect the reason for the increase.
How section 61 and SH-7 fit together
Section 61(1)(a) allows the company to increase its share capital if the articles permit it and the required corporate approval is obtained. SH-7 is the notice to the Registrar that records the change.
The filing is not just a mechanical upload. The company has to show that the change was properly approved and that the capital details in the form match the company’s constitutional documents and board record.
Once the form is filed, the capital details should be updated everywhere the company talks about its capital structure: investor decks, internal registers, future allotment papers, and statutory records.
- • Section 61 supplies the corporate power.
- • SH-7 is the statutory notice.
- • The MOA and records should be aligned after the increase.
Where companies lose time
The biggest delay is fee confusion. Founders often know that the capital is changing but do not calculate the filing fee against the new capital bands until the last moment.
The next issue is document mismatch. The approved increase, the capital stated in the form, and the charter document changes should tell the same story or the filing may be queried.
A third issue is treating the increase as a one-off event. If the company is actively raising or issuing shares, the cap table and the filing record should be reviewed as part of the same workflow, not in separate silos.
- • Check the capital band before submission.
- • Keep the approved amount consistent everywhere.
- • Update the downstream company records after filing.
Government fees
Fee breakdown
| Item | Fee | Notes |
|---|---|---|
| SH-7 fee - up to INR 1,00,000 | INR 5,000 | Normal company fee band for authorised capital registration. |
| SH-7 fee - INR 1,00,000 to INR 5,00,000 | INR 5,000 + INR 400 per INR 10,000 or part | Normal company fee band continues with the incremental calculation. |
| SH-7 fee - higher bands | As per MCA fee table | The fee rises by capital band and is capped by the rules where applicable. |
Timeline
Typical turnaround
Typical timeline usually means a 2 to 4 business days turnaround, assuming documents are complete and any board or shareholder approvals are already in place.
The fee for increasing authorised capital is based on the new capital band and, for a change, the filing fee is the difference between the fee payable on the increased capital and the existing capital at the rates in force on filing date.
Related services
Keep the company moving
Use the extra capital room before or after a foreign investment round.
Keep capital records aligned with the yearly ROC filings.
Keep the audit record updated when the capital structure changes.
Bundle the capital update with a broader company record change if needed.
FAQ
Frequently asked questions
Why does the company need authorised capital if paid-up capital is lower?
What is the main form for increasing authorised capital?
How is the fee calculated?
Does every capital increase need the same approval path?
Canonical reference: https://pvtltd.co/services/increase-authorised-capital
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We can help with the filing, the legal mapping, and the follow-up work that keeps the company compliant after submission.