11/26/2020 0 Comments All You Need to Know About Filing of E-Form PAS-6 by Unlisted Public CompaniesEffective from 02nd October, 2018, Ministry of Corporate Affairs, has inserted Rule 9A of Companies (Prospectus and Allotment of Securities), Rules, 2014, for Issue of securities in dematerialized form by unlisted public companies. You can find complete details of Rule 9A here, along with the Filing of Reconciliation of Share Capital Audit Report in Form Pas-6. First, let’s get familiar with the basic terms:
Dematerialization: This is the process of converting physical share certificates into digital/electronic securities of the same value. Dematerialization makes your assets more secure and liquid and avoids risks such as accidental loss, theft and fraud. Securities: As per section 2(h) of the Securities Contracts (Regulations) Act, 1956, securities are assets including shares, stocks, bonds, scrips, debentures and others. Things to Know About Rule 9A The Rule 9A says,
Where Rule 9A is Not Applicable The Rule 9A is not applicable to an unlisted public company which is either a Nidhi, a Government company, or a wholly-owned subsidiary. How to File Reconciliation of Share Capital Audit Report As per sub rule 8 of rule 9A, the Share Capital Reconciliation Report shall be filed on a half-yearly basis with ROC. The official statement says, “The audit report provided under regulation 55A of the Securities and Exchange Board of India (Depositories and participants) Regulations, 1996 shall be submitted by the unlisted public company on a half-yearly basis to the Registrar under whose jurisdiction the registered office of the company is situated.” Because of the ambiguities in sub rule and no clarification regarding how and when to file such a report, the SEBI (DP) Regulations, 1996 was replaced by SEBI (DP) Regulations, 2018, effective from October 03, 2018. Later, the sub rule 9 of rule 9A was substituted with MCA vide notification dated 22nd May, 2019, effective from September 30, 2019. The rule says, “Every unlisted public company governed by this rule shall submit Form PAS-6 to the Registrar with such fee as provided in Companies (Registration Offices and Fees) Rules, 2014 within sixty days from the conclusion of each half-year duly certified by a company secretary in practice or chartered accountant in practice.” MCA vide general circular released on 28th November 2019 further extended the due date for Filing of Form PAS-6 by sixty days for the half-year ended on 30th September, 2019 from the date when the form is first available on the MCA website. So, the last date for filing e-form PAS-6 is 60 days from 15th July, 2020. Due Date for filing E-form PAS-6 - September 12, 2020 However, since the due date for filing the form is falling between the moratorium period given due to COVID-19 outbreak, a further extension of until 30th September, 2020 was granted (without late fee) for companies to file PAS-6. Details to include in PAS-6 Form
Important FAQ Form PAS-6 FAQS Question:- 1. What is an ISIN? Answer:- Every security issued by a company is given a unique 12 digit identification number called ISIN (International Securities Identification Number). This is true for all types of securities, including equities fully paid up and those partially paid up. Even the equities with differential voting/dividend rights issued by the same company will have different ISINs. For each ISIN, E-form PAS-6 shall be filed. Question:- 2. Do the companies that already filed PAS-6 to ROC in e-form GNL-2 also need to file again in e-form PAS-6 again? Answer:- Companies that have already filed PAS-6 to ROC in e-form GNL-2, which has been already approved by MCA need not to file this report in PAS-6 e-form. However, companies whose GNL-2 has been rejected earlier must file the report now in PAS-6 Form. Question:- 3. Do companies that received ISIN after the dematerialization deadline need to file the reconciliation report in PAS-6? If yes, then for what period? Answer:- Yes, such companies are required to file the report in PAS-6 for the half-year period in which the ISIN is received. Question:- 4. Is the Rule 9A applicable to Deemed Public Companies (private subsidiaries of public companies)? Answer:- Any private company which is a subsidiary of a public company will be treated as a public company irrespective of whether or not it continues to act as a private company in its articles. And so, the rule 9A shall be applicable to such deemed public companies. Question:- 5. Whether transfer of shares also includes transmission in relation of the rule 9A? Answer:- Transfer of shares which are in physical form is restricted under the provisions of rule 9A, but there is no such restriction on transmission, which indicates that transmission is not included in the scope of rule 9A. Question:- 6. Whether private companies are also required to file PAS-6 even though they have already converted their physical shares into Demat form? Answer:- No, private companies do not fall under the ambit of the said rules. Question:- 7. What is the penalty for not obtaining ISIN by the due date? Answer:- As such there is no penalty on non-compliance of the ISIN rule, however, a penalty under section 450 might be applicable. According to section 450, such companies that fail to comply with the rules can be fined for up to ten thousand rupees for the first offense, and one thousand rupees per day for repeated violation.
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