1. Check the Articles of Association for Authority: Check the Articles for authorisation for issue of shares through right issue. If not, please alter the Articles of Association accordingly.

2. Valuation of Shares by Chartered Accountants: The Company shall obtain a valuation certificate from the chartered accountant to determine the offer price. This is a requirement under the FDI Guidelines, Section 62: allotment of shares through right issue is silent on this). Please note that the offer price cannot be less than the valuation price.

3. Notice of Board Meeting: Issue of notice of Board Meeting to all Directors.

Right Issue4. Leave of Absence: Granting of Leave of Absence to the absent Directors.

5. Board Meeting: Holding of Board Meeting and Passing of Board Resolution for:-

1. Recording the name of the person to whom the offer letter to be sent.

2. Preparation of offer letters and give the right to renounce/decline of shares.

3. Authorising someone to issue the offer letter and comply with the other requirements of right issue.

6. Attendance Sheet: Preparation and signing of Attendance Sheet of the Board Meeting.

7. Dispatch of Offer letter: Company shall prepare the offer letter and send the same to the proposed allottee.

8. Mode of dispatch of Offer Letter: Company shall dispatch the offer letter (having option for the right of renouncement) along with application form serially numbered and address to the proposed allottees either in writing (through speed or registered post) or electronic mode atleast three days before the opening the issue.

9. Validity of offer letter: The Offer shall remain valid for minimum 15 days and maximum 30 days from the date of offer. The offer shall be made by notice specifying the number of shares offered.

10. Right of Renouncement: Unless the Articles of Association provide otherwise, the offer letter shall have right to renounce shares, in favour of any other person and this right must be given in the offer letter.

11. Transfer of Money by proposed allottees: The persons whom shares would be alloted shall transfer the money to the Company’s bank account.

12. Keeping track of the money received from proposed allottee: Company shall keep record of receving of money from proposed allottee.

13. Holding of Board Meeting for the purpose of allotment of shares: Hold Board Meeting for allotment of shares subject to the filing of FC-GPR.

14. Filing of FC-GPR: The Company shall file the Form FC-GPR with the Authorised Dealer (Online) for the allotment of shares to the foreign investor.

15. Preparation of List of allotees: Preparation of list of allottees with name, address, emails, PAN, Date of allotment, nominal value of shares, amount paid on security.

16. Filing of Return of allotment with Ministry: Every Company shall file the return of allotment with Ministry of Corporate Affairs within 30 days of allotment of shares under Right Issue in Form PAS-3.

17. Filing of resolution with Ministry: The Company shall file the resolution approving the issue of shares through right issue, with Registrar of Companies with in 30 days of allotment of shares in Form MGT-14.

18. Issue of Share Certificates to the proposed allotees: The Company shall issue the Share Certificates to the proposed allotees within two months from the date of allotment of shares.

19. Stamping of Share Certificates: The Company shall apply for the stamping of share certificates with Revenue Department within one month from the date of issue of share certificates.

Author Bio

Qualification: CS
Company: Legal Corpous Consultancy LLP
Location: delhi, New Delhi, IN
Member Since: 06 May 2019 | Total Posts: 16
CS Suraj Bhardwaj is Associate member of ICSI from 2016, He is also a law graduate. Legal Corpous is the consultancy wing, of ADMS & Co., a Chartered Accountants firm established in 2002. We strongly believe that the audit process should add value to the business and assist its management in View Full Profile

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February 2021