01 August 2014
Allotment of shares to existing shareholders is also a kind of private placement u/s 42 of Companies Act, 2013 and as per proviso to sub section (6) of section 42, monies received on application under this section shall be kept in a separate bank account in a scheduled bank and shall not be utilised for any purpose other than— (a) for adjustment against allotment of securities; or (b) for the repayment of monies where the company is unable to allot securities.