03 July 2015
Dear prof colleagues,
What is the time limit for allotment of shares to foreigners? As per FEMA it is 6 months from receipt of application money. As per CA 2013, it is two months. Which will be superceded by which?
03 July 2015
You will have to comply provisions of both the Act. Hence, you need to allot shares within 2 months. Automatically, FEMA provisions will be complied, since it will be in any case before 6 months.
Suppose, if you allot shares after 90 days, then the company will be liable for non-compliance of only Companies Act and not FEMA.
Being a Company, it has to follow each applicable law and hence you have no option but to allot shares within 2 months
CAclubindia
