issue of shares at premium

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This query is : Resolved

seema singla (Querist)

02 June 2009 A pvt. ltd co. want to issue shares of face value of Rs. 10/- for Rs. 100/-. What is the procedure to be carried on and what aspects are to be looked into ?

CS. Ashish Shah

CS. Ashish Shah (Expert)

02 June 2009 Dear Seema,

A Pvt. Ltd. can issue shares at a premium as per Section 78 of the companies Act, 1956.

An amount equal to the premium is required to be transferred to the Securities Premium Account and the Securities Premium Accounts can be utilised only in accordance with Sub-Section (2) of Section 78.

The Procedure for issuance of shares at premium is as under:

1. Call the Board Meeting for the issue of Shares and fixation of General Meeting date as it is a further issue of shares U/S. 81.

2. Pass the necessary resolution in the Board Meeting

3. Call the General Meeting and passed the necessary resolution for issue of Further shares [U/s 81 or 81(1A)]

4. File Form 23 for the Special Resolution passed in the General Meeting for the further issue of shares

5. File Form 2 for the allotment of shares at a premium.

Both e-forms 23 and 2 should be filed within 30 days with ROC through MCA Portal.

(However, in e-form 2 there is a reference to put SRN of e-form 23. So first file Form 23 and then put SRN of Form 23 in Form 2 and filed the same with ROC through MCA.)

6. Make necessary entries after allotment in the Register of Members.

I think this will suffice your requirement, if you still need resolution of any query, pl. feel free to contact.

Regards,

Ashish Shah

Ankur Garg

Ankur Garg (Expert)

03 June 2009 slightly disagree with Mr. Ashish.

In case of Pvt. Co. section-81 is not applicable. Hence you don't need to call any GM and no need to file Form 23.

Revised procedure would be as under:

1. Call the Board Meeting for the issue of Shares.

2. Pass the necessary resolution for allotment in the Board Meeting

3. File Form 2 for the allotment of shares at a premium. Fill the premium amount carefully.

e-forms 2 should be filed within 30 days of allotment in the BM with ROC through MCA Portal.

4. Make necessary entries after allotment in the Register of Members.

If you need BM resolution for allotment send me a Testmail at "ankur_gargcs@rediffmail.com"

Best Regards

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