Can I issue bonus shares from my private limited company in Madurai?
RE Asked by Reshma Pillai from India
Quick Answer
Bonus shares are issued under Section 63 of the Companies Act, 2013 by capitalising reserves from securities premium or free reserves, by a special resolution.
Detailed Legal Analysis
Bonus shares are issued under Section 63 of the Companies Act, 2013 by capitalising reserves from securities premium or free reserves, by a special resolution. The company in Madurai must file Form MGT-14 with the RoC and ensure compliance with Section 63(1) conditions.
Disputes are appealable to the NCLT and the Madras High Court under Section 61. Local compliance includes Shops and Establishments registration under Tamil Nadu Rent Control Act 1960 for the Tamil Nadu premises.
Bonus shares cannot be issued by revaluing assets without realizing the gains in cash. The authorised capital must be sufficient for the increased share capital.
Disclaimer: AI-generated for educational purposes only. Does not constitute legal advice. Consult a qualified practitioner.