There are some cases in which there is reduction of share capital and no confirmation by the court is necessary.
Reduction Of Share Capital Without The Sanction Of The Court:
There are some cases in which there is reduction of
share capital and no confirmation by the court is necessary. These are:
Forfeiture of shares.
Surrender of shares
Diminution of capital
Redemption of redeemable preference shares.
Purchase of shares of a member by the company under
section 402.
Purchase of its own shares as per section 77A
Raising
Of Capital / Issue Of Shares
Issue
of shares may be made in 3 ways:
1. By private placement of shares;
2. By allotting entire shares to an
issue-house, which in turn, offers the shares for sale to the public; and
3. By
inviting the public to subscribe for shares in the company through a
prospectus.
Private Placement Of Shares:
Shares are issued privately to a
small number of persons known to the promoters or related to them by family
connections.
By An Offer For Sale:
The Issue-house publishes a
document called an offer for sale, with an application form attached, offering
to the public shares or debentures for sale at a price higher than what is paid
by it or at par. This document is deemed to be a prospectus [Section 64(1)].
By Inviting Public Through Prospectus:
The company invites offers from
members of the public to subscribe for the shares or debentures through
prospectus.
Tags : Business Environment and Law-Share & Share Capital
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