Deepak (Associate Consultant) (24 Points)
03 August 2015Should the share application money of newly incorporated companies be deposited in a separate bank account? This appliaction money is towards the first shares issued by the company. Section 42 of companies act 2013 speaks of Private placement which is to increase the existing capital base. But what about the application money of initial shares?
Radhika
(Company Secretary)
(303 Points)
Replied 03 August 2015
Yes. It has to be deposited in a separate bank account within 30 days.
Parth Sharma
(Practicing Company Secretary)
(688 Points)
Replied 05 August 2015
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 05 August 2015
No, consideration for subscripttion shares need not be deposited in separate Bank account. It can be deposited in regular bank account of the company and used for business purpose. The requirement of separate account is applicable only to private placement of shares u/s 42.
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