Issue of shares on premium

Law Aspire (CS) (755 Points)

27 April 2017  

What is the reason for issuing shares on Premium .

For example  Sometimes the Company has Nominal value of each share as 10 and issue at a Premium of Rs. 990. What is the benefit to Company
If the Company issue share at a face value of Rs. 1000/- and not at premium then what will be the difference?