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Category of persons allowed to be alloted shares in pvt. ltd

Rehbar Siamwala (Sr. Executive Taxation) (112 Points)

15 March 2012

In case of increase in subscribed share capital, Share allowed to be alloted to which Category of persons? Any person being a friend of the member of the company or only relatives or any other persons as well?

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9 Replies

(Guest)

Clarify whether its a private company or public company?

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Rehbar Siamwala (Sr. Executive Taxation) (112 Points)
Replied 15 March 2012

in case of Pvt ltd. company

Charu Srivastava (Company Secretary) (4210 Points)
Replied 15 March 2012

In case of a Private Companies

1) Members

2). Directors

3). Relatives of the Directors

can be shareholders

(Guest)

A private company can allot shares to any one. It is not necessary that the person should be director/ relative/ friend etc. There is no bar. It can issue shares to strangers having no relation with the company. Thanks and Regards

(Guest)

Dear Charu, Pls appreciate any one can be shareholder in a private company. However private company can accept loan only from the 3 entities mentioned by you.

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Charu Srivastava (Company Secretary) (4210 Points)
Replied 15 March 2012

So Sorry,

Neha, you are right and i mistakenly mixed provisions of 3(iii) (c) and 3(iii)(d).

Private Company can allot to anyone.

Jiten Gupta (Company Secretary) (1693 Points)
Replied 15 March 2012

Agree with Neha Ma'm!!!! Anyone can be a Share Holder provided existing members' consents are accorded and Resolution is passed!!

P C Agrawal (Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad) (8229 Points)
Replied 15 March 2012

Unless the Articles of the private company provide otherwise, consent of existing members is not required. Only Board resolution will suffice.

Irfan Ansari (Company Secretary) (31 Points)
Replied 30 March 2012

Under Section 3(1)iii (c) Private Companies are barred to offer shares for subscripttion. But such Company is not barred from accepting such subscripttion from Public. If this could be proved then Private Company can easily allot shares to general Public.