Issue of debentures

Arunkumar (Chartered Accountant) (37 Points)

06 February 2012  

Dear All,

Kindly clarify me the following:

1) Can a newly formed Private Limited Company issue Non Convertible Debentures repayable in 5 years? If so, what is the procedure?

2) Is it required to create reserve for redemption in all the five years? or is it enough if reserves are created during last three years when the business has crossed the break even point?