Minimum Subscriptions of Shares

Minimum Subscriptions of Shares

A public limited company cannot make any allotment of shares unless the amount of minimum subscription stated in prospectus has been subscribed. Amount of minimum subscription to be disclosed in prosecutes by Board o f Director taking into account following

    1. Preliminary expenses of company
    2.  Commission payable on issue of shares.
    3. cost of fixed assets purchased or to be purchased
    4. Working capital requirement of company.
    5. Any other expenditure for day to day operation of business.



  • According to guidelines of Securities Exchange Board of India(SEBI) a company must receive a minimum 90% subscription against whole issue before making  any allotment of shares or debenture to public
  • If company is not able to receive minimum subscription of 90% of the issue, the entire subscription shall be refunded to applicants within 15 days from closures of issue.
  • In case of delayed refund interest for the delayed period as per section 73 of companies Act shall be payable @ 4% to 15%(having regard to the length of the period in delay) on the amount of refund.
  • The companies Act 2013 requires that the period of at least one month must be between two calls.
  • The company has right to reject or accept an application fully or partially.



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