Section 70 — Return as to allotments

(1) Whenever a company having a share
capital makes any allotment of its shares, the company shall, within forty-five days
thereafter-

(a) file with the r egistrar a return of the allotment, stating the number
and nominal amount of the shares comprised in the allotment
and such particulars as may be specified, of each allottee, and the
amount paid on each share; and

(b) in the case of shares allotted as paid up in c ash, submit along with
the return of allotment, a report from its auditor to the effect that the
amount of consideration has been received in full by the company
and shares have been issued to each allottee:

Provided that in case, the appointment of auditor is not
mandatory by a company, the report for the purpose shall be
obtained from a practicing chartered accountant or a cost and
management accountant;

(c) in the case of shares allotted as paid up otherwise t han in cash,
submit along with the return of allotment, a copy of the document
evidencing the transfer of non-cash asset to the company, or a copy
of the contract for technical and other services, intellectual property
or other consideration, along with co py of the valuation report
(verified in the specified manner) for registration in respect of which
that allotment was made;

(d) file with the registrar—

(i) in the case of bonus shares, a return stating the number and
nominal amount of such shares comprised in t he allotment
and the particulars of allottees together with a copy of the
resolution authorising the issue of such shares;

(ii) in the case of issue of shares at a discount, a copy of the
resolution passed by the company authorising such issue and
where the maximum rate of discount exceeds ten per cent, a
copy of the order of the Commission permitting the issue at
the higher percentage.

Explanation.— Shares shall not be deemed to have been paid for in cash
except to the extent that the company shall actually have received cash therefor at
the time of, or subsequent to, the agreement to issue the shares, and where shares
are issued to a person who has sold or agreed to sell property or rendered or agreed
to render services to the company, or to persons nominated by him, the amount of
any payment made for the property or services shall be deducted from the amount
of any cash payment made for the shares and only the balance, if any, shall be
treated as having been paid in cash for such shares, notwithstanding any bill of
exchange or cheques or other securities for money.

(2) If the registrar is satisfied that in the circumstances of any particular
case the period of forty five days specified in sub-sections (1) for compliance with
the requirements of this section is inadequate, he may extend that period as he
thinks fit, and, if he does so, the provisions of sub -sections (1) shall have effect in
that particular case as if for the said period of forty five days the extended period
allowed by the registrar were substituted.

(3) No return of allotment shall be required to be filed for the shares
taken by the subscribers to the memorandum on the formation of the company.

(4) Any violation of this section shall be an offence liable to a penalty
of level 1 on the standard scale.

(5) This section shall apply mutatis mutandis to shares which are
allotted or issued or deemed to have been issued to a scheduled bank or a financial
institution in pursuance of any obligation of a company to issue shares to such
scheduled bank or financial institution:

Provided that where default i s made by a company in filing a return of
allotment in respect of the shares referred to in this sub-section, the scheduled bank
or the financial institution to whom shares have been allotted or issued or deemed
to have been issued may file a return of allotment in respect of such shares with the
registrar together with such documents as may be specified by the Commission in
this behalf, and such return of allotment shall be deemed to have been filed by the
company itself and the scheduled bank the financia l institution shall be entitled to
recover from the company the amount of any fee properly paid by it to the registrar
in respect of the return.

CERTIFICATE OF SHARES AND OTHER SECURITIES