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Question
Give one word / Term / phrase for the following statement :
The capital which is not disclosed in the balance sheet.
One Word/Term Answer
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Solution
Reserve Capital
Explanation: It represents the portion of subscribed capital that remains uncalled except in case of winding up or at the time of liquidation. It does not form a part of a company’s Balance Sheet.
As per Section 99 of the Companies Act, 1956, a company can create reserve capital by passing a special resolution.
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