Background – As per Section 62(1) (a) of the Companies act, 2013 if the Company decides to issue fresh shares, these should be offered to existing shareholders in proportion to existing persons who are holders of equity shares.
‘Right Issue’ means offering shares to existing members in proportion to their existing share holding. The object is, of course, to ensure equitable distribution of Shares and the proportion of voting rights is not affected by issue of Fresh shares.
1. Forms to be filed to ROC in case of Rights Issue of Private Company –
- Before 5th June, 2015 the Private Company had to file 2 forms i.e. –
(a) PAS – 3 for return of allotment, and
(b) MGT – 14 for powers of board under section 179 (3) (c) which says board resolution can be passed for issue of shares hence section 117 (3) (g) provides that resolutions passed in pursuance of sub-section (3) of section 179 shall be filed with the ROC.
So, on 5th of June, 2015 Ministry of Corporate Affairs by Notification exempted the Private Companies from the section 117 (3)(g).
Hence now if Private Companies comes up with a Rights Issue it can be done by only filling PAS -3 with (Table A and B and Board Resolution for allotment) as an attachment to the ROC within 30 days from the passing of Board Resolution for allotment of shares.
2. Forms to be filed to ROC in case of Rights Issue in case of Public Companies (Unlisted)-
a. PAS – 3 within PAS -3 with (Table A and B and Board Resolution for allotment) as an attachment to the ROC within 30 days from the passing of Board Resolution for allotment of shares, and
b. MGT – 14 for powers of board under section 179(3)(c) which says board resolution can be passed for issue of shares hence section 117(3)(g) provides that resolutions passed in pursuance of sub-section (3) of section 179 shall be filed with the ROC.
Very usefully.