Please tell me that if a pvt co wants to issue shares to unsecured loans instead of paying cash than what would be the consequences and what procedure to be followed? please help...............
CA Mohit Agrawal (Chartered Accountant) (371 Points)
31 January 2012Please tell me that if a pvt co wants to issue shares to unsecured loans instead of paying cash than what would be the consequences and what procedure to be followed? please help...............
Mazhar Shaikh
(Intern)
(72 Points)
Replied 31 January 2012
As per your question i understand that
you want to convert your unsecured loan in share capital
Firstly you need to check that you have that much un subscribed capital or not for which you want to issue shares if not increase your authorised capital by filing form 5 and from 23.
and if u already have that much unscribed capital than you can file form 2 for allotment of shares and issue the share certificate to your unsecured loan providers.
CA Mohit Agrawal
(Chartered Accountant)
(371 Points)
Replied 31 January 2012
But sir do i require to do any thing more after this and what things should be considered?
Mohammed
(CS, Mcom, LLB)
(852 Points)
Replied 03 February 2012
Please refer the below expert opinion
/experts/conversion-of-loan-into-share-capital-778115.asp
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