18 December 2009
Can any one guide me for Compliances to be followed at the time of raising share application money and also what are the provisions relating to it after raising that money. Please provide also the source
You may record the above transaction i.e. receipt of share application money and assurance given to proposed allottee in the board meeting minutes.
In other words simple noting of such receipt in the board minutes would be enough. No need to take any kind of approval from any concerned authorities.
Regarding time limit to convert such share application money into capital the law is silent. However as per practice allot share with 6 months of the receipt of application money.
Further collect the share application form from the proposed allottee for your record. You may download the sample share application from the link mentioned below:
21 December 2009
The entry in one company is written as advance to contractors a/c dr to share application money
here the contractor to the company is the person who applied for shares. so the company instead of giving advance to the contractor and also the contractor instead of giving share appliation money, adjustment entry has been passed in the books of contractee. is this correct, if so what are the compliances to be followed, whether it should be considered as taken in cash or it should be taken as other than cash, if so what are the consequences
23 December 2009
In case the shares are to be issued for consideration received other than cash, then the above entry is correct.
Please also arrange for an agreement with the contractor who is supplying services in lieu of shares. This agreement will be required at the time of Filing Form No. 3 with the ROC in addition to the regular Form No. 2.
CAclubindia
