can a public company alott shares to persons other than existing shareholders without applying sec 81(1A).?
Please advice.
Regards.
15 Replies
Ankur Garg
(Company Secretary and Compliance Officer)
(114773 Points)
Replied 18 June 2009
No.
A public company can not alott shares to persons other than existing shareholders without applying sec 81(1A).
Regards
Ajay Mishra
(Company Secretary)
(74337 Points)
Replied 18 June 2009
Hi Swati,
In case of further issue of shares to non existing shareholder of public company u must comply section 81 of the Companies Act, 1956.
Regards
CS Ankur Srivastava
(Company Secretary & Compliance Officer)
(17853 Points)
Replied 18 June 2009
Dear Swati
In case of further issue of shares, shares must be offered to the existing shareholders and after the expiry of the time specified or on receipt of earlier intimation from the shareholder that he decline to accept the shares offered, the BOard of directors may dispose the shares of them in such manner as they think most beneficial to the company.
In case the company want to offer shares to the persons other that its existing shareholders it must have to comply section 81(1A).
ACS_RR
(Service)
(58 Points)
Replied 18 June 2009
I fully agree with the views mentioned herein. A Public Company cannot issue shares to other Shareholders without Complying with the provisions of section 81(1A).
I further need a clarification that whether a Public Company can issue Shares to outsiders if the allotment is within one year of the first Allotment i.e. the time limit as mentioned in section 81(1).
swati shinghal
(cs)
(42 Points)
Replied 18 June 2009
yes ...public co. can issue further shares to outsiders as per sec 81(1) (c) i.e only if the existing shareholders (if The articles provide)renounces the shares in favour of any other person and and as rightly pointed out by Mr.Ankur that after the expiry of the time specified in notice the BOD may dispose off the shares as most beneficial to the company.
CS Ankur Srivastava
(Company Secretary & Compliance Officer)
(17853 Points)
Replied 18 June 2009
Yes, in case the company is issuing shares within 1 year of the first allotment, the company can offer the shares to the persons other that its existing sharehollders and section 81 would not apply and it would not be treated as further issue of shares.
swati shinghal
(cs)
(42 Points)
Replied 18 June 2009
yes i agree to mr.ankur....an allotment made within one year can be made to outsiders and sec 81(1) will not apply.
CA CS Bhumika Thakkar
(CA,CS)
(1618 Points)
Replied 18 June 2009
| Originally posted by :Ankur Srivastava | ||
| " | Yes, in case the company is issuing shares within 1 year of the first allotment, the company can offer the shares to the persons other that its existing sharehollders and section 81 would not apply and it would not be treated as further issue of shares. | " |
yes,rite...
Payal Jain
(CS)
(152 Points)
Replied 27 April 2010
Kindly Explain what is the defination of first allotment??? Will subscrption to the memorandum considered as first allotment?
Ritesh
(Student CS)
(21 Points)
Replied 11 March 2011
Can anyone give me Special resolution passed under section 81(1A)
manohar
(C.A.)
(25 Points)
Replied 18 July 2012
Can anyone tell me the consequenses of non-comlaince with section 81(1A) and unlisted public company rules, 2011. Whether the allotment can be termed as void, voidable or just penalty would be charged.
Irregularities are as follows:
- Special resolution is 1.5 year old before allotment.
- Special resolution is filed to ROC after 4 years.
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