Reclassification of authorised share capital

[Ekta Saxena]

Dear experts

Can the company reclassify its preference share capital into equity? 

[mgra...@gmail.com]

Yes , a company can re-classify its preference shares in to equity. there is no restrictive section in the companies Act.

[Ekta Saxena]

Thanks for the reply Sir

But the ROC has marked the form for re-submission with the following remarks-

No conversion/re-classification of Equity Shares into Preference Shares or vice. versa has been permitted under the provisions of the Companies Act, 2013 (even not provided in Section 61 of the Act), therefore, Pl explain why not e-form may be considered for rejection.

Pls Advice the further course of action.

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[Neha R]

Dear all, 

I have handled few cases for reclassication of share capital. The same depends upon ROC to ROC..in Delhi ROC raise concern & sometime reject whereas when I have for one of my company in chennai, same got approved..

Regards,

Neha Rai

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[Ekta Saxena]

I am dealing with ROC Delhi.

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[CA. Pradeep K Jain]

yes it can be reclassify, check your MOA, AOA, which type of authorisation is given to board or members.

other you can reclassify by altering capital clause of moa, and aoa if any repercussion on it. 

On Mon, 5 Aug 2019 at 17:36, Ekta Saxena <csektas...@gmail.com> wrote:

Dear experts

Can the company reclassify its preference share capital into equity? 

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"HAPPY TO SERVE"

CA. Pradeep K Jain

(Practicing chartered Accountants)

FCA, ACS

M. 9999928735

[Ekta Saxena]

Dear Experts 

In which Section, reclassification of shares can be done, as the same is not mentioned in Section 61. 

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[Deepak Singhal]

Its mentioned in Section 61 but however ROC as per there internal guidelines will not allow you to change Equity into Preference

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