Krushna (ACS) (119 Points)
25 March 2011Our's is a private company.
My doubt is 'Is there any interest mandatorily payable on Share Application money pending allotment as it is in case of Call in advance?'
Please guide.
Madhusudan Kabra
(knowledge seeker)
(1779 Points)
Replied 25 March 2011
na..... it's not neccessary to pay interest on share application money.
the logic behind this may be " there is no contractual liability arise on share application money as just applying for share does not bound company unless otherwise the company allotes shares againist the same.
The another ground for this may be,is Share application money pending for allotment is shown under share holders fund , not under secured/unsecured loans etc. as per Schedule VI of companies act, and we know we never pay interest to on shareholders fund.
Hope ur query is satisfied.
Regards
Madhusudan
CAclubindia
