Mathew George ACMA (Finance Manager) (71 Points)
11 January 2011Hello Sir's
What will be consequences if the share application money is not allotted for the last six years. The share application money was actually brought by the Managing Director (Expired).
At the same time is there any penalty if ,in the above mentioned situation, the share application money is 3 times higher than the Authorised Capital for the last financial year (2009-10) and in the previous years also........?
Expecting the reply at the earliest
CA CMA CS Ram Pavan Kumar Melam
(CA)
(6980 Points)
Replied 18 January 2011
Hi, it is not clear whether your company is private limited or limited. In case of limited company, the RBI regulations would also attract apart from Companies Act, as they may deem it as public money.
As per my knowledge holding the share application in excess of 3 months has to be refunded to the applicants. Regarding allotment
1. For listed companies we would follow SEBI guidlines;
2. For unlisted and Private Companies, you may go through section 113 read section with 69 to 75 (wherever applicable) of the Companies Act.
There is no provision in the Companies Act to penalise the companies receiving in excess of the authorised capital.
CAclubindia
