Share issue at premium

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Nitin (Querist)
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20 March 2012
Can a private limited company issue shares to Directors at X amount & to non directors at Y amount (at premium)at the same time?

Ajay Mishra

Ajay Mishra (Expert)
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20 March 2012 Hi

In Companies Act, for private company, there is no restriction if you are issuing shares to Indian investor at different price on the same meeting. It is not a good corporate practice. I will suggest you to allot shares with some interval and with different date.

Regards

Jiten Gupta

Jiten Gupta (Expert)
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20 March 2012 Yes a Pvt Ltd company can do!!

In the same meeting, you can allot the shares to Two Different person at two different price i.e. different premium!!!!

Ravi Jhamb

Ravi Jhamb (Expert)
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20 March 2012 A Public Company can issue share to Public and Director. Bt a Pvt. Company Can not issue share to public. they can issue only Direcotors. There are 2 director in Public and 7 Director in Pvt. Co.

In your case Mr. Y is treated as Public so you can't issue to them

Jiten Gupta

Jiten Gupta (Expert)
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20 March 2012 Mr. Ravi,

First there are minimum 2 Directors in Pvt Ltd Company and 3 Directors in Public Company!!

Secondly, A Pvt Ltd Company can allot shares to any one provided number of Members should not exceed 50. It is no where mentioned that Directors are only eligible to hold shares!!

But as this is practice in Pvt Ltd Company to include its Directors, relatives and closely held persons, among its members.

Ajay Mishra

Ajay Mishra (Expert)
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20 March 2012 Dear expert friends

Try to resolve the query and give answer which will resolve the matter and increase your and our knowledge. So on the basis of our reply they can resolve their queries.

Thanks

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Nitin

Nitin (Querist)
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21 March 2012 Yes Mr Ravi,there is as such no restriction on issuing share to non directors by a pvt ltd company ,my only question was that at the same meeting the company can issue shares to directors & non directors at a different price ?As conculded from your expert opnion i think rightly said as 'Yes'.Thanks .

Ravi Jhamb

Ravi Jhamb (Expert)
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16 April 2012 Thanx Expert to clear my opinion. i agree with Ajay Mishra. This is not good practice.

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