Section 67 of companies act

sahara was exploiting this provision on the premise that the section does not give any time frame and AT ONE TIME they did not offered shares to 50 persons. Because they did not breached the limit AT ONE TIME they contended that they are not making public offer. However, SC did not agreed to their contention but still didnot laid the law. 

Meanwhile MCA amended the prefrential allotment rules and the said rules provide that "no further invitation shall be be made unless allotment in respect of the previous placement has been completed".

In nutshell, there is no montly/yearly etc time limit and AT ONE time the private offer should not be be made to 50 persons and further private offer cannot be made till the comp;letion of allotment under prior private placement.

Cavet - Under the companies bill the limit of no. of person (presently 50) will be applicable on yearly (financial) basis.