Allotment of Shares by Private Placement
Done-for-you by Company Mitra's qualified experts — 100% online, transparent pricing, no running around.
- 10 to 15 working days
- 100% Online
- Qualified Experts
- Secure Payment
What you get
- Filed MGT-14 with special resolution
- Filed PAS-3 return of allotment
- PAS-4 offer letter and PAS-5 record of offers
- Board and members resolutions with minutes drafts
- Updated register of members and share certificates
Documents required
Keep these ready — scanned copies or clear phone photos are fine.
- Certificate of Incorporation (Company) – Mandatory
- Company PAN (Company) – Mandatory
- Latest MOA and AOA (Company) – Mandatory
- Class 3 DSC of director (Director) – Mandatory
- Latest audited financial statements (Company) – Mandatory
- Valuation report from registered valuer (Company) – Mandatory
- Bank statement of separate bank account showing receipt of share money (Company) – Mandatory
- PAN and address proof of each allottee (Shareholder) – Mandatory
- Increase in authorised capital details if required (Company) – Optional
How it works
10 to 15 working days after receipt of funds and documents
- 1Share your plan
- 2Tell us the number of shares, issue price and investor details.
- 3Valuation and drafting
- 4We arrange the valuation and draft the resolutions, notice and offer letter.
- 5Approve the issue
- 6Shareholders pass the special resolution and we file MGT-14.
- 7Receive funds
- 8Investors pay into a separate bank account opened for the issue.
- 9Allotment and filing
- 10Board allots shares and we file PAS-3 with the ROC.
About Allotment of Shares by Private Placement
Overview
A private placement is the most common way for a private company to raise fresh equity from identified investors. Under Section 42 read with Section 62(1)(c) of the Companies Act, 2013 and Rule 14 of the Companies (Prospectus and Allotment of Securities) Rules, 2014, the company must pass a special resolution, issue a private placement offer letter in Form PAS-4, keep a record of offers in Form PAS-5, receive money only through banking channels in a separate bank account, and allot shares within 60 days.
Company Mitra manages the full process for you:
- Checking authorised capital and eligibility
- Arranging the valuation report from a registered valuer
- Drafting notices, resolutions and the offer letter
- Filing MGT-14 and the PAS-3 return of allotment
- Updating statutory registers and share certificates
If the authorised capital is not enough, it must be increased first through SH-7, which we can handle as an add-on. Where an investor is a non-resident, FC-GPR reporting under FEMA is also required. Final fee depends on the number of allottees and whether capital increase or FEMA reporting is needed.
Who needs it
- Private companies raising equity from identified investors
- Startups onboarding angel or seed investors
- Companies issuing shares to friends, family or strategic partners
- Companies converting loans or advances into equity through a fresh issue
What's included
Included:
- Eligibility check under Sections 42 and 62(1)(c) and Rule 14
- Drafting of board and EGM notices, special resolution and explanatory statement
- Preparation of private placement offer letter (PAS-4) and record of offers (PAS-5)
- Filing of MGT-14 for the special resolution
- Filing of PAS-3 return of allotment with list of allottees
- Drafting of board resolution for allotment and share certificate format
- Coordination with registered valuer for valuation report
Not included:
- MCA filing fees and state stamp duty
- Registered valuer fee for valuation report
- Demat or ISIN related charges where Rule 9B applies
- FEMA filings if any allottee is a non-resident
Ready to get started?
Place your order in 2 minutes — our expert takes it from there.
Frequently asked questions
How many people can be offered shares in a private placement?
An offer can be made to a maximum of 200 persons in a financial year, excluding qualified institutional buyers and employees under ESOP.
Is a valuation report required?
Yes, Rule 13 requires a valuation report from a registered valuer for a preferential or private placement issue.
Within how many days must shares be allotted?
Shares must be allotted within 60 days of receipt of application money, otherwise the money must be refunded within the next 15 days.
When should PAS-3 be filed?
PAS-3 must be filed with the ROC within 15 days of the date of allotment.
Can share money be received in cash?
No, the application money must be received by cheque, demand draft or banking channels only, from the bank account of the subscriber.
Compliances after this
- Issue share certificates within 2 months of allotment or credit shares in demat form where required
- Update register of members (MGT-1)
- File FC-GPR within 30 days if shares are allotted to a non-resident
- Use the funds only after filing PAS-3
Penalty for delay / non-compliance
Under Section 42(9), failure to file PAS-3 attracts a penalty of Rs 1,000 per day of default, up to Rs 25 lakh, on the company, promoters and directors. Contravention of Section 42 can attract a penalty up to the amount raised or Rs 2 crore, whichever is lower, under Section 42(10), along with refund of money to subscribers within 30 days of the order.
