Tag Archives: Share Capital


Reduction of capital is a sensitive issue; managerially, financially, economically, and legally. Hence, reduction of capital by a company is always subject to confirmation by the Tribunal on an application made by the company. Company applying for reduction may either be a company limited by share or a company limited by guarantee but having a share capital. Reduction of capital must be approved by special resolution passed by the company. a company may reduce share capital in following manner –

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SHARE CAPITAL (Companies Act, 2013)

We have discussed earlier post The Company under the Companies Bill 2012 which is still relevant when the bill become Act; all companies do not have share capital. Only companies limited by shares have share capital.


The share capital of companies limited by share shall be of two kinds, namely;

(a)  equity share capital;

(b) Preference share capital.

Here, use of two terms “Shall be” and “and” denote this is a requirement to have both kind of share capital but, according to further reading, company may have zero equity or preference share capital.

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