PPT: Prospectus and Allotment of Securities | Corporate & Other Laws for CA Intermediate PDF Download

 Page 1


SECTION 407: Definitions
PROSPECTUS AND 
ALLOTMENT OF SECURITIES
Page 2


SECTION 407: Definitions
PROSPECTUS AND 
ALLOTMENT OF SECURITIES
Section 23 - Public offer and private placement
(New Section)
Companies Act, 1956 Section 23 
Companies Act, 2013
1) No corresponding section 1) New provision 
*** Issue of securities by different types of companies have been streamlined.           
Issue shall be in accordance with applicable rules, regulations and 
guidelines of the Companies Act, 2013 as well as ICDR Regulations, 2009.   
Types of issues have been classified as follows:
For public company- For private company- (NYN)
a) Public offer                                                    a) Private placement
b) Private placement (Not yet notified)            b) Rights or bonus issue
c) Rights or bonus issue
Page 3


SECTION 407: Definitions
PROSPECTUS AND 
ALLOTMENT OF SECURITIES
Section 23 - Public offer and private placement
(New Section)
Companies Act, 1956 Section 23 
Companies Act, 2013
1) No corresponding section 1) New provision 
*** Issue of securities by different types of companies have been streamlined.           
Issue shall be in accordance with applicable rules, regulations and 
guidelines of the Companies Act, 2013 as well as ICDR Regulations, 2009.   
Types of issues have been classified as follows:
For public company- For private company- (NYN)
a) Public offer                                                    a) Private placement
b) Private placement (Not yet notified)            b) Rights or bonus issue
c) Rights or bonus issue
The term private placement has been defined in explanation II (ii) of section 42 as 
follows-
"private placement" means any offer of securities or invitation to subscribe
securities to a select group of persons by a company (other than by way of public
offer) through issue of a private placement offer letter and which satisfies the 
Conditions specified in this section.
Section 23 - Public offer and private placement
(New Section)
Page 4


SECTION 407: Definitions
PROSPECTUS AND 
ALLOTMENT OF SECURITIES
Section 23 - Public offer and private placement
(New Section)
Companies Act, 1956 Section 23 
Companies Act, 2013
1) No corresponding section 1) New provision 
*** Issue of securities by different types of companies have been streamlined.           
Issue shall be in accordance with applicable rules, regulations and 
guidelines of the Companies Act, 2013 as well as ICDR Regulations, 2009.   
Types of issues have been classified as follows:
For public company- For private company- (NYN)
a) Public offer                                                    a) Private placement
b) Private placement (Not yet notified)            b) Rights or bonus issue
c) Rights or bonus issue
The term private placement has been defined in explanation II (ii) of section 42 as 
follows-
"private placement" means any offer of securities or invitation to subscribe
securities to a select group of persons by a company (other than by way of public
offer) through issue of a private placement offer letter and which satisfies the 
Conditions specified in this section.
Section 23 - Public offer and private placement
(New Section)
23. (1) A public company may issue securities—
(a) to public through prospectus (herein referred to as "public offer") by complying with 
the provisions of this Part; or
(b) through private placement by complying with the provisions of Part II of this Chapter
(not  notified); or
(c)  through a rights issue or a bonus issue in accordance with the provisions of
this Act and 
in case of a listed company or a company which intends to get its securities listed also 
with the provisions of the Securities and Exchange Board of India Act, 1992 and the 
rules and regulations made thereunder.
(2) A private company may issue securities— (not  notified)
(a)  by way of rights issue or bonus issue in accordance with the provisions of
this Act; or
(b) through private placement by complying with the provisions of Part II of this Chapter.
Explanation.—For the purposes of this Chapter, "public offer" includes initial public
offer or further public offer of securities to the public by a company, or an offer for sale of
securities to the public by an existing shareholder, through issue of a prospectus.
Section 23 - Public offer and private placement
(New Section)
Page 5


SECTION 407: Definitions
PROSPECTUS AND 
ALLOTMENT OF SECURITIES
Section 23 - Public offer and private placement
(New Section)
Companies Act, 1956 Section 23 
Companies Act, 2013
1) No corresponding section 1) New provision 
*** Issue of securities by different types of companies have been streamlined.           
Issue shall be in accordance with applicable rules, regulations and 
guidelines of the Companies Act, 2013 as well as ICDR Regulations, 2009.   
Types of issues have been classified as follows:
For public company- For private company- (NYN)
a) Public offer                                                    a) Private placement
b) Private placement (Not yet notified)            b) Rights or bonus issue
c) Rights or bonus issue
The term private placement has been defined in explanation II (ii) of section 42 as 
follows-
"private placement" means any offer of securities or invitation to subscribe
securities to a select group of persons by a company (other than by way of public
offer) through issue of a private placement offer letter and which satisfies the 
Conditions specified in this section.
Section 23 - Public offer and private placement
(New Section)
23. (1) A public company may issue securities—
(a) to public through prospectus (herein referred to as "public offer") by complying with 
the provisions of this Part; or
(b) through private placement by complying with the provisions of Part II of this Chapter
(not  notified); or
(c)  through a rights issue or a bonus issue in accordance with the provisions of
this Act and 
in case of a listed company or a company which intends to get its securities listed also 
with the provisions of the Securities and Exchange Board of India Act, 1992 and the 
rules and regulations made thereunder.
(2) A private company may issue securities— (not  notified)
(a)  by way of rights issue or bonus issue in accordance with the provisions of
this Act; or
(b) through private placement by complying with the provisions of Part II of this Chapter.
Explanation.—For the purposes of this Chapter, "public offer" includes initial public
offer or further public offer of securities to the public by a company, or an offer for sale of
securities to the public by an existing shareholder, through issue of a prospectus.
Section 23 - Public offer and private placement
(New Section)
Section 24 - Power of Securities and Exchange Board 
to regulate issue and transfer of securities, etc.
Section 55A 
Companies Act, 1956
Section 24 
Companies Act, 2013
1) No such provision in 
section 55A of Companies 
Act, 1956
2)   Reference to statement in 
lieu of prospectus
1) The SEBI shall, in respect 
of matters specified by the 
section to be administered 
by it, exercise the powers 
conferred upon it under 
sub-sections (1), (2A), (3) 
and (4) of section 11,
sections 11A, 11B and 11D 
of the Securities and 
Exchange Board of India 
Act, 1992.
2)   Such reference omitted