Glossary

Authorised vs paid-up capital: what is the difference?

MCA master data shows two capital figures for every company limited by shares. Suppliers often read the larger one as the company's size. It is not, and neither figure is the money in the bank.

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Short answer

Authorised capital is the maximum share capital a company is permitted to issue under its memorandum of association; it is a ceiling, not money raised. Paid-up capital is the part of issued share capital that shareholders have actually paid to the company for their shares. Both appear on the MCA master data page. Paid-up capital shows what owners have put in as share capital, but it says nothing about the company's current cash, profits or debts.

The capital ladder

TermMeaningExample (hypothetical)
Authorised capitalMaximum shares the company may issue₹10,00,000
Issued capitalShares the company has offered₹5,00,000
Subscribed capitalShares taken up by shareholders₹5,00,000
Paid-up capitalAmount actually paid on those shares₹5,00,000 (or less if partly paid)

In most private companies issued, subscribed and paid-up capital are the same figure. Authorised capital is often set higher so the company can issue more shares later without amending its memorandum.

Where to see them

  1. Open mca.gov.in > MCA Services > Master Data > View Company or LLP Master Data.
  2. Enter the CIN or name and the captcha.
  3. Read the Authorised Capital and Paid up Capital fields in rupees.
  4. For an LLP, the equivalent field is the total obligation of contribution.

What a supplier can read from the numbers

Paid-up capital is a rough signal of how much the owners have committed as share capital. A company with ₹1,00,000 paid-up capital asking for ₹50,00,000 of credit is relying entirely on borrowed money and trade credit, which tells you to look harder at its filings, its charges and your own experience with it. A large paid-up capital is reassuring but not proof of solvency, because the money may have been spent long ago.

What the numbers do not show: cash, turnover, profit, net worth, debts or whether it pays suppliers on time. For those you need the filed financial statements (available through paid document inspection on MCA), the GST filing record of the buyer, and your own ledger. A quick GSTIN check on FundRaksha Trust shows whether the buyer's GST registration is active.

Why it matters in recovery

A private limited company's shareholders are generally liable only up to the amount unpaid on their shares, so when capital is fully paid, a supplier cannot usually chase shareholders personally for the company's debts. That is why the routes that reach the company's assets, or that reach directors personally in defined cases, matter: Section 141 for bounced company cheques, personal guarantees, and director liability after strike off under Section 248(7).

FundRaksha Legal looks at the whole MCA record, not one number, before choosing the route. Fee: 30% only on recovery.

Last reviewed: 2026-10-20. Information for Indian businesses; not legal advice.

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  • Purchase order, delivery challan, e-way bill or proof of service
  • Messages, emails or letters about the payment
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FAQ

Questions, answered

Not necessarily. Authorised capital is only a ceiling. Look at paid-up capital, filed financial statements and turnover.

This page is general information for Indian businesses, not legal advice for your specific case. Laws, rates and procedures change; speak to an advocate before acting. FundRaksha LegalTech Pvt Ltd is a technology company; legal work is carried out by enrolled advocates.