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Unlisted public companies (prefrential allotment) rule 2013

Preeti (Student) (58 Points)

02 May 2013

According to Unlisted Public Companies (Prefrential Allotment) Amendment Rule 2013, a public unlisted company has to allot equity shares within 60 day of receipts of share application money. Can we allot after 60 days on permission of shareholders /board/applicant of equity(already ultimate holding company)

Thanks in anticipation.

Regards,

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3 Replies

Sonam Bidasaria (CA) (770 Points)
Replied 07 May 2013

hello.

Shares have to be alloted within 60 days from the date of receipt of application money. In case shares are not allotted and the period of 12 monhs haven not been lapsed from passing the special resolution, then the company should pass a fresh Board resolution for again inviting application money from the prospective allottes.

It may be noted that the proviso to Rule 8(4) also states that :

Provided that the monies received on such application shall be kept in a separate bank account and shall not be utilised for any purpose other than—

(i) for adjustment against allotment of securities; or

(ii) for the repayment of monies where the company is unable to allot securities.

That means once the application money is receieved and deposited in specfic account, the company has to either issue the shares or refund it back after the expiry of 60 days. Atleast from this account, the Company will not be able to transfer funds to its own accoi=unt after 60 days.

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sobha (trainee) (22 Points)
Replied 03 January 2014

an unlisted company has received advance share application money from its directors, within what time it has to allot shares to them? as no share application is received in this case and only board resolution is passed for acknowledgement of the same.