Share application money already accepted till 13/12/2011

Yes the Company should allot Shares within 60 days, failing which they need to refund the share application money within 15 days after the expiry of 60 days. & this rule doesnot apply to Private Limited Companies.

Regards

Sriram

Rules are silent about the treatment of application money received before amendment.

However as per my understanding also you should allot shares within 60 days of amendment in the Rule 8 of Unlisted Public Companies (Preferential Allotment) Rules, 2003.

Regards

Ankur

In the absence of expressed provision, my opinion is there is no harm or difficulty even if we do not allot shares in 60 days for application money recd before 13.12.2011.

Yes, the Rules are silent on the share application money already accepted.  It may not be possible in many cases to apply the same in totality to share application money already accepted.  For example, the Rules provide for keeping the money in separate Bank account and non-utilisation thereof till allotment.  What if the  company has already deposited the money in normal bank account and used the amount for business purpose?  It cannot be said to be in violation of the Rules now.  Though strictly speaking not necessary, keeping in view the intention of the government and also good corporate governance practice, it will be better if allotment is made at the earliest.

 there are no explicit provisions regarding acceptance of share application money  prior to this amendment in the notification, so  I opine that there is no harm in not alloting shares with in 60 from date of notification.

yes since there is no specific provisions regarding the usage of application money and allotment of shares prior to the date of notifiaction. There seems to be no harm in not having complied with  the said requirement.