Allotment of shares

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Payal N Purohit (Querist)
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13 August 2013 Dear all,

A Pvt. Ltd. Company was incorporated on 21st September, 2010. The subscribers to the MOA are Non-Resident Companies. However the Company received the share subscription amount on 17th January, 2013 post that date shares were allotted to them on 22nd Jan, 2013. Now as per Section 113 of the Companies Act, 1956 the share certificates are to be issued within 3 months of allotment. So the Company will issue share certificates on 18th April, 2013.

Is this valid as per Companies Act??

Is there any time limit within which the subscribers are required to bring the subscription amount...If yes, which provision states that??

Ajay Mishra

Ajay Mishra (Expert)
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13 August 2013 Hi

I will suggest you to read Master Circular issued by RBI on this matter on July 01, 2013.

For more go to the following link:

https://www.rbi.org.in/scripts/BS_ViewMasCirculardetails.aspx?id=8104

Payal N Purohit

Payal N Purohit (Querist)
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16 August 2013 Thank you Sir...

From that RBI Circular I was able to locate the time frame within which the Shares should be given after inward remittance...i.e., 180 days.

However my question is within how many days are the subscribers required to bring in the amount??

Thanks..

Ajay Mishra

Ajay Mishra (Expert)
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16 August 2013 The time period is not defined.

In accordance with the provisions of section 36(2) of the Companies Act, 1956, all money payable by any member to the company under the MOA or AOA shall be debt due from him to the company. Further, a subscriber to the memorandum must pay for his shares in cash even if the promoters have promised him the shares for services rendered in connection with the promotion of the company.

Payal N Purohit

Payal N Purohit (Querist)
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16 August 2013 Ok...Thanks

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