Preferential Share Allotment on Private placement basis
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
20 August 2010
Hi All,
I run a start up and we want to raise money from market through private placement issuing preferrential share. Wanted to know the following
- Is a start-up allowed to raise money through such route
- Is there any approval required
- How one fixes the price
- What are the regulatory risk involved
-what happens if the company fails to make the payment of the share holders in the stipulated time.
Kindly edcuate me on this, I need the information urgently. Looking forward to help of this estemeed group. Thanks a lot in advance, regards
I run a start up and we want to raise money from market through private placement issuing preferrential share. Wanted to know the following
- Is a start-up allowed to raise money through such route
- Is there any approval required
- How one fixes the price
- What are the regulatory risk involved
-what happens if the company fails to make the payment of the share holders in the stipulated time.
Kindly edcuate me on this, I need the information urgently. Looking forward to help of this estemeed group. Thanks a lot in advance, regards
20 August 2010
Yes start-ups are allowed to follow the same route. Read section 81(1A). As per this section you have to collect approval of shareholders for preferential allotment through passing of special resolution in a general meeting.
However section 81 is not applicable to a private company. A private com. can issue shares simply by passing a board resolution.
After allotment you have to file form 2 with ROC to update paid up capital of the company.
However section 81 is not applicable to a private company. A private com. can issue shares simply by passing a board resolution.
After allotment you have to file form 2 with ROC to update paid up capital of the company.
Message likes :
1 times
20 August 2010
There are a lot of formalities and procedures which need to be followed. In case you are interested, get in touch with me. I am a corporate lawyer specialising in capital markets regulations.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- GST ITC REVERSE
- Fixe term employment
- Is any professional CA is here please reply
- EXPORT BILL UNDER LUT FREIGHT CHARGE INCLUED IN INVOICE IT LIABLE TO TAX
- Gift Received from nonblood relative
- Section 50-fixed asset-->building ceases to exist
- RCM ISSUE ON RENT AND TRANSPORTATION CHARGES
- Foreign lottery ticket bought online from India: legality, tax and consequences
- Putting a heading on received mail
- Tax Audit u/s 44AB for Transport Business A proprietorship is engaged in transportation business and
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- STATUTORY AUDIT OF A SMALL PRIVATE COMPANY INCORPORATED ON 28.03.2025
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
- Resigning a auditor from the company for misconduct
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
- CALCULATION OF DEFFERED TAX - OP BL IS DTL & CURRET IT DTA
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
