Sec 56

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swasti

swasti (Querist)
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27 March 2012 Under the new proposal U/s 56 in the Finance Bill, can a NEW company issue shares at premium and how ?

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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04 April 2012 Section 56(2)(viib) is applicable to PRIVATE COMPANIES only.

So, if a newly formed PUBLIC company issues shares at premium, then Section 56(2)(viib) is NOT attracted.

swasti

swasti (Querist)
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05 April 2012 Thanks Sir, but suppose it is a closely held company then what would be the provision. The newly formed company would be having face value of its shares as Rs 10/-. can't it issue shares at premium?

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CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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05 April 2012 It cannot issue shares at premium.

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swasti

swasti (Querist)
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05 April 2012 Thanks a lot Sir.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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05 April 2012 You are welcome.