Company Registration in Tirupur
Companies Act, 1956: Section 2(32)
The term 'paid-up capital' includes capital credited as paid-up. The words "credited as paid-up" seem to have become necessary as a part of the definition of paid-up capital because of allotment of shares by way of bonus without any payment and yet an amount equal to them has to be deemed credited to the company's paid-up share capital The words 'capital credited as paid-up', thus includes bonus issue etc., where no consideration is actually received by the company. Paid-up capital is different from 'Called-up capital' and is arrived at after deducting the unpaid calls from the called-up capital. The share application money before allotment will not form part of paid-up capital. In the different works on company law the expression 'paid-up capital' has been taken to mean the amount of issued share capital which has been taken up by shareholders who have agreed to give consideration in cash or kind for the shares issued to them unless those shares are fully paid bonus shares. This statement in PALMER'S COMPANY LAW as cited by Kerala High Court in SNDP Yogam,y Unknown, (1970) 40 Com Cases 60, 69 (Ker) is followed by a remark that issued nominal capital is an represents an authority by the shareholders to the directors to create new capital, where it was emphasized that a company having no authorized or stated capital cannot have pick-up share capital. Section 148 of the 1956 Act (s. 60 of the 2013 Act) requires that where any notice, advertisement or other official publication or any business letter, bill head or letter paper of a company contains a statement of the authorized capital there must be mentioned in an prominent position and in equally conspicuous character the amount of the capital which has been subscribed and the amount paid-up. The amount of paid-up share capital is also reckoned for the purposes of some provisions of the Companies Act, 1956 e.g. those relating to borrowings, lending and investments in other companies.
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