Aditi Jhunjhunwala (Practising Company Secretary) (236 Points)
30 September 2010I wish to know if there is any limitation of time on the adoption of Share Certificates after the Incorporation of a Pvt Ltd Co. Also is there any minimum period prescribed for allotment of shares to the subscribers of memorandum?
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 30 September 2010
Hi,
Subscribers of MOA are deemed shareholders of the company. They don't need to take shares. As soon as they subscribe the MOA & file it with ROC along with other incorporation documents they become the members as well as shareholders of the company. Appreciate further have you ever filed form-2 for the subscribers? The answer would be No. That itself is a kind of proof that no allotment is required to be made to the subscribers.
Form-2 is not required to be filed for subscribers hence no formal allotment is required in case of subscribers. They are deemed members and shareholders of the Company.
Regarding receipt of payment from subscribers I would say ideally such amount should be deposited by the subscribers after incorporation of the co. in the newly opened bank a/c of the company and record the same in the first BM Minutes.
Alternatively, as there is no tracing (as far as ROC is concerned) of such amount, it may be deposited by them later. As a CS i would suggested you should opt I option to avoid any kind of future problem.
DATE OF ALLOTMENT TO SUBSCRIBERS AND DATE TO BE MENTIONED ON SHARE CERTIFICATE
Date of allotment to subscribers will be the date of incorporation of the company and the same date will also be used for printing on share certificate to be issued to subscribers.
Practically & legally this is very much possible. To conclude you may use Date of Incorporation of the company for the purpose of:
1. Printing on share certificate of subscribers
2. as date of Allotment to subscribers
3. For the purpose of filling the column in register of member to enter the name of subscribers.
Even if you receive the amount from subscribers after 6 months the date of deemed Allotment and date on share certificate would remain the same i.e. date of incorporation of the company.
In case of any doubt please post it. I’ll definitely try my best to solve it. This is my personal opinion.
Best Regards
Aditi Jhunjhunwala
(Practising Company Secretary)
(236 Points)
Replied 30 September 2010
Thank u Mr. Garg for the info. I would like to inform you that no form 2 is filed but my query is that what if the share certificates are adopted, say 6months after the date of incoporation. And also the date on sh certificates also are that of the meeting on which they are adopted??Is it any violation or is there any provision??
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 30 September 2010
What exactly written on share certificate?
1. Share certificate issued on....
2. Given under the common seal dated...
3. Or Something else...
Section 113 is for dispatch of share certificate. But it talks about time limit for dispatch of share certificate after allotment or transfer and in your case it is neither allotment nor transfer. So i think law is silent....
NIRALI SOLANKI
(JOINT MANAGER LEGAL & SECRETARIAL)
(87 Points)
Replied 01 October 2010
Dear Ankur Sir,
As per my Knowledge we are finalising or adopting the format for the share certificate on First Board meeting. So, Practically speaking we cant issue share certificate on the date of Incorporation.
As per my view, can we take allotment date as a date of first board meeting as we are passing resolution for allotment of shares in first board meeting and there after we can issue share certificate on any day within the reasonable tiime for allotment. (i.e., 30 days) Is it in Correct?
CS Ankur Srivastava
(Company Secretary & Compliance Officer)
(17853 Points)
Replied 01 October 2010
Dear Nirali,
The shares had already been allotted to the Subscriber of Memorandums(deemed allotment). You are just giving the share certificate to them. Therefore, as Mr. Ankur mentioned above, the date of allotment would be the date of incorporation, the date of issuance of certificate under the heading:-
"Given under the Common Seal of the Company this" would be the date of Board meeting
Because before this date you have not adopted the Common Seal and the Share Certificate
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 01 October 2010
Hello Ma'am,
Adoption of format of share certificate at a BM and issue of share certificate at the same BM is not an issue at all and is very much legal. After adoption of format there is no need to get it approved from any authority so company can very much use it in the same BM through a board resolution subsequent to the resolution adopt the format of share certificate.
There is no need to pass formal allotment resolution in favour of subscribers as there is no formal allotment involved in the process. Simple noting of their subscribed shares in the BM is enough.
Thanks
CS Ankur Srivastava
(Company Secretary & Compliance Officer)
(17853 Points)
Replied 01 October 2010
| Originally posted by : Ankur Garg | ||
 |
Hello Ma'am, There is no need to pass formal allotment resolution in favour of subscribers as there is no formal allotment involved in the process. Simple noting of their subscribed shares in the BM is enough. Thanks |
 |
Yes, after allotment you can give share certificates to the Subscribers of Memorandum without having any discussin in the Board meeting regarding the same.
However, i would recommend that just note 1 line in the Board Minutes aftter the adoption of common seal and share certificates that
"It was further informed to the Board that the Shares Certificates have been issued to the Subscribers of Memorandum. The Board noted the same"
Aditi Jhunjhunwala
(Practising Company Secretary)
(236 Points)
Replied 01 October 2010
Thank u all for ur guidance and I understood the matter but Ankur ji, my case is-
Given under the Common seal dated...... is written on the Share Certificate.... For Ex- date of Incorporation is- 23.3.07.... The date of First BM is 24.3.07.... Common seal adopted on 24.3.07. Sh Certificates adopted on BM of 14.1.08 and date on Sh Certificate as "Given under the Common seal dated 14.1.08''... Is it correct?? Also as Mr. Srivastava suggested..the issuance of share certificates to the subscribers also is on 14.1.08. Now please guide.
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