Santhosh Ganesh (AGM - Secretarial ) (136 Points)
15 February 2013Hi All
Whithin how many days of receiving Share Application Money the Shares Should be Allotted to the the applicants?
is there specific section which deals with the existing Company Law? if so what is that
and if the shares are not alloted within the prescribed period what is the remedy / penalty available in Companies Act 1956?
Khushboo Maheshwari
(Company Secretary)
(548 Points)
Replied 16 February 2013
Hi
if your company is unlisted, then as per Unlisted Public Companies (Preferential Allotment) Amendment Rules, 2011, u need to allot shares with 60 days from receipt of share application money.
thanks
prakash
(Company Secretary)
(1352 Points)
Replied 18 February 2013
Mr. Santhosh,
In unlisted public companies, any allotment of securities shall be completed within sixty days from the receipt of application money and in case the company is not able to allot the securities within the said period of sixty days, it shall repay the application money within 15 days thereafter, failing which it will be required to be re-paid with interest at the rate of twelve per cent per annum.
these rules are not applicable to private companies, but good corporate practice to allot shares with said period.
CAclubindia
