Share subscription - resolution

Neha Mam Please mail me the same on nagarkaryuti @ yahoo.com

Neha Mam Please mail me the same on nagarkaryuti @ yahoo.com

I would like to thank Shri Ankur Garg for his great contribution to this forum and guidance to students and members on various issues from time to time.  I agree with his views expressed above on this topic.  However I differ on the point of date to be mentioned in the share certificate.  Date which is mentioned at the end of share certificate is the date of signing the share certificate and not the date of allotment of shares. 

In standard form of share certificate generally used by companies (sample attached), there is no provision for mentioning date of allotment.  Date of allotment can be mentioned additionally, if so desired, in the body of the share certificate.  However, the date at the end of the share certificate will only be the date of signing the certificate.

Following points may be noted in this regard:

1.  Printing of share certificates requires Board resolution.  Rule 8 of Companies (Issue of Share Certificates) Rules 1960 reads as under:

"All blank forms to be used for issue of share certificates shall be printed and the printing shall be done only on the authority of a resolution of the Board. The blank form shall be consecutively machine-numbered and the forms and the blocks, engravings, facsimiles and hues relating to the printing of such forms shall be kept in the custody of the secretary or such other person as the Board may appoint for the purpose; and the secretary or other person aforesaid shall be responsible for rendering an account of these forms to the Board."

2.  Common seal of the company should also be adopted by the Board.

3.  Common seal should be affixed in the present of directors/secretary as provided in Rule 6 which reads as under:

"Every share certificate shall be issued under the seal of the company, which shall be affixed in the presence of : (i) two directors or persons acting on behalf of the directors under a duly registered power of attorney; and (ii) the secretary or some other person appointed by the board for the purpose. The two directors or their attorneys and the secretary or other person shall sign the share certificate:"

From the above it follows that sequence of events will be as under:

1.  Company is incorporated.

2.  First Board meeting is held at the earliest (say within a week).  Board will note, inter-alia, subscribers becoming members of the company and resolution is passed for getting the share certificates printed.  In the meantime common seal is also ordered.

3.  In the next Board meeting resolution is passed for issue of share certificates to the subscribers.  (Alternatively, this can be added in the first meeting itself).  Board also adopts common seal of the company.

4.  Company issues share certificates to the subscribers.

5.  Signature part of the share certificate reads as under:

Here it will be noticed that the directors/secretary are signing the certificate as witness to common seal which is being affixed to the certificate which can be printed only after Board resolution and when common seal is adopted by the Board.  It follows that this is the date of execution of the certificate and not the date of allotment of shares.  If the company is incorporated on say 1.1.2012 and share certificates are printed on say 7.1.2012 under Board's authority, we cannot say that the certificates were signed on 1.1.2012 itself.  This can be possible only when on the date of incorporation all formalities are completed (i.e. passing Board resolution, adoption of common seal, printing of share certificates etc.).

Thanks

Email sent. Pls check.

Dear Ms. Neha,

Can you please provide me copy of condonation letter on dalveersingh @ aimil.com.

Regards

Dal Veer

I have mailed you please check....

With Regards

DEAR EXPERTS,

                             SOME OF THE PROFESSIONALS HAVE COMMENTED THAT THIS ISSUE WOULD BE AFFECTED BY FEMA  AND RBI. I GOT THE POINT OF RBI'S GUIDELINES AND THE FORMALITIES WHICH NEEDS TO BE ADHERED BUT HOW COME FEMA COMES IN.

EXPERTS PLEASE CLEAR MY DOUBT.

REGARDS,

TANVEER MD MASOOD

Ms Neha,

Coming to Mr Maneesh's remarks made earlier, What are the consequences on deemed allotment upon incorporation but money not coming in .. say 2-3 months or 6 months later.

Does it not violate any law?

Dear Ms. Neha,

Please email me a format of Condonation Letter to RBI to my email id : praveents @ gmail.com

Regards,

Praveen

Respected Sir/Mam,

I require attachments for filling FC - GPR form, can anyone please provide me. 

My mailid is : lovishbansal555 @ gmail.com

Hello everyone in the loop, may I ask for a copy of Board Resolution for first share subscripttion to Foreign National via FC-GPR route, my email ID is cavarunsharma @ outlook.com

May I ask a question here, as E-biz has come into picture now for advance reporting and filing of FC-GPR can chariman of the company file directly Advance reporing after taking KYC and FIRC from Bank ?

Please advice and share. 

Hi Neha,

Can you please forward copy of the letter to casmassociate @ gmail.com

Please can you mail the letter @ reenavirwadia @ gmail.com

Thank you so much in advance