Opening of bank account

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Upendra Mani Tripathi

Upendra Mani Tripathi (Querist)
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01 August 2014 Dear sir, it is mandatory to open separate account for issuance of shares to its existing shareholders.

Ankur Garg

Ankur Garg (Expert)
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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.

Kindly wait for the opinion of other experts.

Thanks