Reissue of forfeited shares

[Aditi Pandey]

Dear All,

What is the procedure of reissue of forfeited shares of Private Company?

[Peer Mehboob]

There is no specific provision in the Companies, Act, 2013 regarding forfeiture and reissue of shares. Moreover, if there is no specific clause regarding forfeiture and reissue of shares in the Articles of Association of the company also, simply Board Resolution will be passed for reissue of forfeited shares and Form PAS-3 will be filed.

On 23 January 2017 at 15:12, Aditi Pandey <csadit...@gmail.com> wrote:

Dear All,

What is the procedure of reissue of forfeited shares of Private Company?

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[Aditi Pandey]

I think that there is no new allotment of shares so why we have to file PAS 3. As per my knowledge , under old companies act only Board resolution is sufficient. So what we will do under new companies act 2013.

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[Peer Mehboob]

Forefieture of shares is the another way of reduction of share capital. If company has forefited shares, company would have reduced its paid up share capital by the forfieted amount of shares and in case of reissue of shares, obviously paid up share capital will be enhanced. So, PAS-3 has to be filed.

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[Aditi Pandey]

Thank You for clearing my doubts.

[falguni shah]

Did you re-issued the forfeited shares? 

if yes what step did you took for taking effect and resolution passed? Which form need to be submitted?

[Mahi Awasthi]

Hi,

Since the position on filling of return of allotment on reissue of shares is very clear and unambiguous [Gopal Jalan case]that since allotment is not issue of new sales, but merely a sale hence no need to file return of allotment i.e. PAS 3. 

on basis of which authority you are saying that it needs to be filled. I am sort of working on a problem wherein I have to defend the position that reissue also requires PAS 3 filling, but all the cases say contradictory. If you have any authority on basis of which you said that it needs to be done please do share it. 

[Mahi Awasthi]

regarding, this except for the fact that re issuance must be done in accordance to Articles of Association of the company, what else is required to make reissuance of forfeited shares valid. Is there any different form that needs to be filled for reissuance.