Return of allotment PAS-3
E-Form PAS-3 is required to be filed pursuant to Section 39(4) and 42(9) of the Companies Act, 2013 and rule 12 and 14 Companies (Prospectus and Allotment of Securities) Rules, 2014 which are reproduced for your reference.
Section 39(4):
Whenever a company having a share capital makes any allotment of securities, it shall file with the Registrar a return of allotment in such manner as may be prescribed.
Section 42(9):
Whenever a company makes any allotment of securities under this section, it shall file with the Registrar a return of allotment in such manner as may be prescribed, including the complete list
1. Preferance Shares
As per Section 55 of COMPANIES act,2013 . Issue and Redemption of Preference Shares
(1) No company limited by shares shall, after the commencement of this Act, issue any preference shares which are irredeemable.
(2) A company limited by shares may, if so authorised by its articles, issue preference shares which are liable to be redeemed within a period not exceeding twenty years from the date of their issue subject to such conditions as may be prescribed:
3.As per Section 55 of COMPANIES act,2013 company shall pass special resolution for issue of all types of preferance Share
Issue and Redemption of Preferance Shares
(1) No company limited by shares shall, after the commencement of this Act, issue any preference shares which are irredeemable.
(2) A company limited by shares may, if so authorised by its articles, issue preference shares which are liable to be redeemed within a period not exceeding twenty years from the date of their issue subject to such conditions as may be prescribed:
Provided that a company may issue preference shares for a period exceeding twenty years for infrastructure projects, subject to the redemption of such percentage of shares as may be prescribed on an annual basis at the option of such preferential shareholders:
Conduct the Board Meeting and Approve preference share issue including “letter of offer”, which shall include the right of renunciation also in case of Right Issue. Issue notice of the general meeting. Company Secretary or any director of the company shall be authorized to issue a notice of a general meeting.
Filed the MGT-14 with ROC before issue of Letter of Offer to any person (Whether member or not)
Circulate Letter of Offer On Receive acceptance/renunciations/rejection of rights from members to whom the offer has been sent & also from persons in whose favor right was renounced.
Conduct the Board Meeting and Approve allotment bypassing of board resolution. And present a list of allottees before the board.Pass resolution for Issue of share certificates.
Point to be mentioned in a special resolution passed for the issue of preference shares
As mentioned above for issuing preference shares a special resolution is required to be passed and so the points to be mentioned in the special resolution passed for the purpose of issue of preference shares are as follows:
(A) The rights of the preference shareholders with respect to payment of dividend or repayment of capital in comparison to equity shareholders;
(B) The share of preference shareholders in the surplus fund during the course of winding up;
(C) The right to participation in surplus assets and profit, on winding-up (if any);
(D) The payment of dividends whether on the cumulative or non-cumulative basis as is the case;
(E) The conversion of preference shares into equity shares;
(F) The voting rights;
(G) The redemption of preference shares
Equity Shares
2. Equity shares with Differential Rights
As per Section 48 of COMPANIES act, 2013
Where a share capital of the company is divided into different classes of shares, the rights attached to the shares of any class may be varied with the consent in writing of the holders of not less than three-fourths of the issued shares of that class or by means of a special resolution passed at a separate meeting of the holders of the issued shares of that class,—
3. Equity shares without Differential rights
(a) As per Section 62 of COMPANIES act,2013 . Issue Further Shares by way of Right issue.
(b) As per Section 42 of COMPANIES act,2013 . Issue Further Shares by way of Private placement.
(c) As per Section 65 of COMPANIES act,2013 . Issue Further Shares by way of Sweat Equity Share .
- Right issue means offering shares to the existing shareholders in the ratio of their existing shareholding
- Hold Board Meeting and approve letter of offer
- letter of offer shall be dispatched through registered post or speed post or through electronic mode or courier or any other mode having proof of delivery to all the existing shareholders at least three days before the opening of the issue.
- Hold second Board Meeting and board resolution for allotment of shares shall be passed. Allotment should be done within 60 days from the date of Receiving money.
- Existing shareholders can renounce his shares offered to him in favour of any other person; and the notice referred to in clause (i) shall contain a statement of this right;
- File return of allotment to ROC within 30 days from the allotment of shares.
- Issue share certificate within 2 months from the date of allotment.
Private placements
As per Section 42 of Companies Act,2013
The offer of securities or invitation to subscribe securities, shall be made to not more than 50 persons in a single offer or not more than 200 persons in the aggregate in a financial year (excluding qualified institutional buyers and employees of the company being offered securities under ESOP). This restriction would be read for all the securities combined together in a Financial Year.
- Hold Board Meeting (a)To approve the list of identified persons (b)To approve the draft offer letter (c)To call GM
- Hold General Meeting To pass special resolution approving PP and approving offer letter
- File form MGT-14 File the Special Resolution in Form MGT-14 within 30 days from the date of EGM
- Circulate the Offer Letter (PAS-4) (A)PAS-4 to be circulated to the identified persons. (B)It can be circulated only after filing MGT-14
- Receive the Application money
- The Application money to be received and kept in a Separate Bank Account
- The subscription money shall be paid either by cheque or demand draft or other banking channel or not by cash.
- File Return of Allotment The Return of Allotment in Form PAS-3 to be filed within 15 days from the date of allotment
- Utilization of amount The amount can be utilized only after filing PAS-3
- Issue of Share Certificates within 2 months from the date of allotment Updating the Register of Members
Issue of Bonus Shares
(1) A company may issue fully paid-up bonus shares to its members, in any manner whatsoever, out of—
(i) its free reserves;
(ii) the securities premium account; or
(iii) the capital redemption reserve account:
Provided that no issue of bonus shares shall be made by capitalizing reserves created by the revaluation of assets.
(2) No company shall capitalize its profits or reserves for the purpose of issuing fully paid-up bonus shares under sub-section (1), unless—
(a) it is authorized by its articles;
(b) it has, on the recommendation of the Board, been authorized in the general meeting of the company;
(c) it has not defaulted in payment of interest or principal in respect of fixed deposits or debt securities issued by it;
(d) it has not defaulted in respect of the payment of statutory dues of the employees, such as, contribution to provident fund, gratuity and bonus;
(e) the partly paid-up shares, if any outstanding on the date of allotment, are made fully paid-up;
(f) it complies with such conditions as may be prescribed.
(3) The bonus shares shall not be issued in lieu of dividend.
- Hold Board Meeting
- Place before the Board Resolution for issue of Bonus Shares.
- Pass Board Resolution for issue of shares.
- Decide the Ration of Shares offering to share holders.
- Fixing the date, time, and venue of the general meeting and authorizing a director or any other person to send the notice for the same to the members.
- File form MGT-14 File e-form- MGT-14 within 30 days of Passing of Board Resolution for issue of shares.
- CONVENE A GENERAL MEETING Check the Quorum. Pass Ordinary Resolution for bonus issue of shares.
- Hold Board Meeting Pass Board Resolution for allotment of shares
- File Return of Allotment The Return of Allotment in Form PAS-3 to be filed within 30 days of passing of Board Resolution for allotment of shares.
4. Issue of Debenture
As per Section 71 of COMPANIES act,2013.
Issue of Debentures.
(1) A company may issue debentures with an option to convert such debentures into shares, either wholly or partly at the time of redemption:
Provided that the issue of debentures with an option to convert such debentures into shares, wholly or partly, shall be approved by a special resolution passed at a general meeting.
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{The author i.e. Shahbaz Khan is a Company Secretary in Practice at Shahbaz Khan and Associates and can be reached at (M) 8982766623 and (E) [email protected]}
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