Form PAS-6 is introduced by the MCA for unlisted public companies to submit the Reconciliation of Share Capital Audit
Report provided under sub-rule (8) and (8A) of rule 9A Companies (Prospectus and Allotment of Securities) Rules,
2014.
It 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 within sixty days from the conclusion of each half-year duly certified by a
company secretary in practice or chartered accountant in practice.
The company shall also immediately bring to the notice of the depositories any difference observed in its issued capital
and the capital held in dematerialised form.
While there are no specific penalties for non-compliance with Section 29 of the Companies Act, which addresses the
dematerialisation mandate along with Rule 9B of the PAS Rules, it's important to note that the general penalties
outlined in Section 450 of the Companies Act could potentially be applicable in this scenario:
The company can't issue or allot any securities including bonus shares in any form and buyback of shares/securities.
Any shareholder who has not dematerialised their holdings will be unable to sell their shares or subscribe to additional
shares.
The company faces monetary penalties of INR 10,000 plus INR 1,000 for each day the violation continues,…
An ISIN, or International Securities Identification Number, is a globally recognized code used to uniquely identify
securities such as stocks, bonds, and other financial instruments. It serves as a standardized identifier assigned to
each security, facilitating efficient trading, settlement, and regulatory compliance
Registrar and Transfer Agents (RTAs), like NextGen Share Registry manage investor records.
- Depository Participants (DPs), like MLB Capital assist investors with demat account opening and securities
transactions.
- Depositories (NSDL or CDSL) are institutions that hold securities electronically.
The Indian government made it mandatory for private limited companies to dematerialise their shares in October 2023
with the aim to improve transparency, efficiency, and investor protection in the corporate sector. This move is expected
to create a more streamlined and secure business environment for both private companies and investors in India.
The timeline depends on the number of shareholders, cap table complexity and the availability of all the necessary
documents. However, on an average, it could take anywhere between 2-5 weeks.
If your paid-up capital exceeds INR 4 crores and your annual turnover is over INR 40 crores, the Ministry of Corporate
Affairs mandates you to dematerialise by September 30th, 2024.
However, even if you don't fall into this range right now, it is advisable to proactively dematerialise your physical shares
as the mandate will apply to you, as your business grows
Section 2(8) of the Companies Act, 2013, defines Nominal Capital as the amount of capital that the Memorandum of the company authorizes as the share capital of the company. Hence, it is the registered amount authorized that can be raised by issuing shares.
Nominal Capital is also known as Authorized Capital, and should not be confused with Paid up Capital
