PROCEDURE

 
1. A notice by registered post is sent to the defaulting members demanding payment.

 
2. A list of persons, who have not paid the amounts due inspite of the notice, will be prepared.

 
3. The Board meeting will consider the proposal for forfeiture and will direct the secretary by resolution to issue notice to the member (as per draft approved by the Board) requiring him to pay the money due on the shares.

 
4. The notice will further state that in case of non-payment on or before the date mentioned therein, the share is liable to be forfeited without further notice.

 
5. The resolution will authorise the Secretary to take further action to forfeit the shares in case the conditions of the notice are not complied with.

 
6. Where the money due is not received on or before the due date specified in the notice, the director or secretary, authorised by the Board, will make a declaration, which will be duly verified, that the share in the company has been
forfeited on the date stated in the declaration.

7. A notice will be published in the newspaper.

 
8. Stock exchange will be advised of the forfeiture in the case of listed shares, immediately after the Board meeting.

 
9. The forfeited shares may then be disposed by sale or in any other manner as directed by the Board.

 
10. Short particulars of reissued shares will be advised to the stock exchange concerned.

 
11. Before selling the forfeited shares, keep ready a duly verified declaration in writing signed by the director, manager or secretary of the company stating that the shares of the company have been forfeited on a particular date.

 
12. The aforesaid declaration will serve as conclusive evidence against all persons claiming title to shares forfeited and sold to others.

 
13. To give effect to the sale of forfeited shares, the Board will authorise some person, preferably the director or Secretary, to transfer the shares sold to the purchaser thereof and to make a declaration in connection therewith.

 
14. Show full consideration either by receipt or by adjustment, for the sale of forfeited share and execute the transfer of those shares in favour of the person to whom shares are sold or disposed of.

 
15. The defaulting members will be asked to return the share certificates.

16. If they fail to do so fresh certificates will be issued.

 
17. Public and stock exchange will be advised not to deal with the old certificates.

 
18. On registration of the transfer in the books of the company, the purchaser will be recorded as the owner of the shares in question.

 
19. Any surplus arising out of sale after adjusting the amount due to the company in respect of the shares will be refunded to the member concerned.

I agree with Mr. Adarsh

Originally posted by : Adarsh
	PROCEDURE   19. Any surplus arising out of sale after adjusting the amount due to the company in respect of the shares will be refunded to the member concerned.

 Dear Adarsh,

 I dont agree with the above mentioned 19th point. The proft will be transferred to CAPITAL RESERVE ACCOUNT and not to be refunded to the member concerned.

What is the Time Limit or in how many years should the forfeited shares be reissued? if at all there is a time limit?

Please let me know as the shares of my company were forfeited in the year 1996-97. So can those be reissued now?