BUY BACK-COMPLETE OVERVIEW
There
are many reasons & benefits to buy-back its shares by a company, some of
them are produced below:-
·
To
pay the surplus funds to the shareholders;
·
To
maintain the debt-equity ratio;
·
To
provide an exit route to the shareholders;
·
To
service the equity of the company in a more efficient manner;
·
To
increase the return on capital & return on net worth;
·
To
Apart from this, buyback prevents mergers, takeovers and
monopolization by aiding the survival of consumer sovereignty. Thus, if
any other company is planning to buy the majority shares in the market, the
company can fend-off such an intruder by doing a buyback and owning the shares
once again.
·
To
rationalizes the capital structure by writing off capital not represented by
available assets and are considered more tax efficient compared to dividends.
·
To boost shareholder value, share price while
creating tax benefit for investors with earning good returns on the gaps in
prices on the basis of the company’s fundamental.
·
To reward company’s investors, improve financial
ratios (price to earnings, return on assets and return on equity),
increase promoters holding, reduce public float and check the declining stock
price, reduce volatility and build investors’ confidence
OBJECTIVES
OF BUYBACK OF SHARES
·
Unused
cash: If the company has a huge cash reserve with not many future projects to
invest in and if the company thinks the market price of its shares is
undervalued, they can buy back shares as a reward for their shareholders.
·
Tax
Gains: The companies prefer buyback to reward their investors instead of
distributing cash dividends because dividends are taxed at higher rate than
capital gains. At present, short-term capital gains are taxed at 10% and
long-term capital gains are not taxed.
·
Market
Perception: By buying shares back from the shareholders at a higher price than
the prevailing market price indicates the company shares valuation should be
higher.
·
Exit
Option: If a company wants to exit the market from a particular country or want
to close the companies it can offer to buy back its shares that are trading in
the market.
·
Escape
monitoring of accounts and legal controls: If a company wants to avoid the
regulations of the market regulator by delisting. They avoid any public scrutiny
of its books of accounts.
SOURCES
OF BUY-BACK:
A
company may purchase its shares out of:-
·
its
free reserves;
·
the
securities premium account; or
·
the
proceeds of the issue of any shares or other specified securities.
COMMENT:
HOWEVER, NO BUY-BACK OF ANY KIND OF SHARES CAN BE MADE OUT OF THE PROCEEDS OF
AN EARLIER ISSUE OF THE SAME KIND OF SHARES.
PROHIBITIONS
ON BUY-BACK:
No
company shall directly or indirectly purchase its own shares:-
·
through
any subsidiary company including its own subsidiary companies;
·
through
any investment company or group of investment companies; or
·
if
a default, is made by the company, in the repayment of deposits accepted either
before or after the commencement of this Act, interest payment thereon,
redemption of debentures or preference shares or payment of dividend to any
shareholder, or repayment of any term loan or interest payable thereon to any
financial institution or banking company, however, the buy-back is not
prohibited, if the default is remedied and a period of three years has lapsed
after such default ceased to subsist;
·
The
Company shall not buy-back its shares If the company has not complied with the
provisions of Section 92 (Annual Return), 123 (Declaration of Dividend), 127
(punishment for failure to distribute dividend) and section 129 (Financial
Statement);
PRICING
OF BUYBACK
Methods for buyback entails:
·
Fixed
price tender offer – Shareholders have the option to sell or hold the fixed
number of shares, offered by the company at a fixed price. This process ensures
all shareholders are treated equally, no matter they hold majority or minority
stake. Recently, Indian Oil Corporation Limited has offer for buyback of
29,76,51,006 fully paid-up equity shares at a price of Rs 149 per share.
·
Buying
from open market – The company’s broker buyback its own shares from the market,
repurchase program happen for a extended period of time as a large block of
shares needs to be bought. Recently, Selean Exploration Technology Limited has
offer for buyback of 16,400,000 fully paid-up equity shares at a price of Rs
300 per share.
PRE-CONDITIONS
In order to carry out a buyback of
shares, the following matters need to be considered to by the company:
• The buyback should be authorized by
its Articles of Association;
• It should be approved by the Board or
shareholders, as the case may be;1
• Buyback should not exceed 25% of its
paid up equity share capital in one Financial Year;
• Post Buy-back, the Debt Equity Ratio
of the company should not exceed 2:1;
• Equity Shares to be bought back must
be fully paid up;
• Buy-back should be completed within 1
year of passing of the resolution;
• Company should ensure that at least
50% of the amount earmarked for buy-back, as specified in resolutions is
utilized for buying-back shares;
PROVISIONS
FOR BUY-BACK OF SHARES:
(i) Authorization for
Buy-Back:- Articles
of Association(AOA) of the company should authorize Buy-Back if no provision in
AOA then first alter the AOA.
(ii) Approval:- The Buy-back can be
made with the approval of the Board of directors at a board meeting and/or by a
special resolution (SR) passed by shareholders in general meeting, depending on
the quantum of the buyback.
Approval
of Board of Directors- up to 10% of the total paid-up equity capital and free
reserves of the company;
Approval
of Shareholders- up to 25% of the aggregate of paid-up capital and free
reserves of the company.
(iii) Notice of General
Meeting:-The
notice of the meeting at which the special resolution is proposed to be passed
shall be accompanied by an explanatory statement in which the particulars
required to be mentioned as per section 68(3) [a to e] and Rule 17(1) [a to n]
of Companies (Share Capital and Debentures) Rules, 2014 should be disclosed.
File MGT-14.
(iv) Methods of
Buy-Back:-
The Buy-back of shares of private & unlisted public companies may be –
from
the existing shareholders on a proportionate basis;
by
purchasing the securities issued to employees of the company pursuant to a
scheme of stock option or sweat equity.
(v) Letter of Offer
(Form SH-8):-
Before the buy-back of shares, the company shall file with the Registrar of
Companies a letter of offer in e-form SH-8 and the letter of offer shall be
dispatched to the shareholders immediately after filing the same with the
Registrar of Companies but not later than 20 days from its filing with the
Registrar of Companies ensuring the matters as prescribed in the Sub-rule 10 of
Rule 17 of The Companies (Share Capital and Debentures) Rules, 2014.
(vi) Declaration of
Solvency (Form SH-9):- The company shall file with the Registrar of Companies,
along with the letter of offer, a declaration of solvency in e-Form SH-9.
(vii) Offer Period:- The offer for buy back
shall remain open for a minimum period of 15 days but not more than 30 days
from the date of dispatch of letter of offer (Period may be less than 15 days
if all members agreed).
(viii) Debt-equity
Ratio:-
The ratio of the aggregate of secured and unsecured debts owed by the company
after buy-back shall not be more than twice the paid-up capital and its free
reserves.
(ix) Fully Paid-up
Shares:-
Shares to be bought back must be fully paid up.
(x) Time limits:- Buy-back shall be
completed within a period of 1 (one) year from the date of passing of SR or
Board Resolution, as the case may be. No offer of buy-back shall be made within
a period of one year from the date of the closure of the preceding offer of
buy-back, if any.
(xi) Acceptance of
Offer:-
In case the number of shares offered by the shareholders is more than the total
number of shares to be bought back by the company, the acceptance per
shareholder shall be on proportionate basis out of the total shares offered for
being bought back.
(xii) Verification:- The company shall
complete the verifications of the offers received within fifteen days from the
date of closure of the offer and the shares lodged shall be deemed to be
accepted unless a communication of rejection is made within twenty-one days
from the date of closure of the offer.
(xiii) Separate Bank
Account:-
After the closure of the buy-back offer, the company shall immediately open a
separate bank account and deposit therein, such sum, as would make up the
entire sum due and payable as consideration for the shares tendered for
buy-back.
(xiv) Payment:- Within 7 days from the
date of verification of the offers:
Make
payment of consideration in cash to those shareholders whose shares have been
accepted.
Return
the share certificates to those shareholders whose shares are not accepted at
all or the balance of shares, if partly accepted.
(xv) Extinguishment of
Shares certificates:-
The company shall Extinguish and physically destroy the shares certificates
bought back within 7 days of the last date of completion of buy back.
(xvi) Prohibition on
further issue of shares:- The company shall not make a further issue of the same kind
of shares including allotment of new shares under clause (a) of sub-section (1)
of section 62 within a period of six
months except by way of a bonus issue or in the discharge of subsisting obligations
such as conversion of warrants, stock option schemes, sweat equity or
conversion of preference shares or debentures into equity shares.
(xvii) Register of
Buy-Back (SH-10):-
The Company shall maintain a register of shares which has been bought back in
Form SH-10.
(xviii) Return of
Buy-Back (SH-11):-The
Return of Buy back with the Registrar in Form SH-11 on completion of buyback
along with the certificate in Form SH-15 certifying that the buy-back of shares
has been made in compliance with the provisions of the Act and rules within 30
days of such completion.
(xix) Capital Redemption
Reserve Account:-
If the buy-back of shares is made out of free reserves or securities premium
account a sum equal to the nominal value of the shares so purchased shall be
transferred to the capital redemption reserve account and details of such
transfer shall be disclosed in the balance sheet and the amount of the said
reserve may be applied by the company, in paying up unissued shares of the
company to be issued to members of the company as fully paid bonus shares.
(xx) Punishment:- If a company makes any
default in complying with the provisions of section 68, then the punishment
shall be as follows:-
COMMENT:
BEFORE BUY BACK THE ENTIRE PROMOTER/DIRECTORS AND KMP’S SHARES OF THE UNLISTED
PUBLIC COMPANIES MUST BE IN DE-MAT MODE.
BASIS
OF VALUATION OF BUY-BACK PRICE:
The
Companies (Share Capital & Debentures) Rules, 2014 has not defined any
basis of valuation of buy-back price to be complied with by Private companies
and unlisted public companies. Company is free to make a valuation of buy-back
price on any relevant basis. A company can also make a valuation on the basis
of the current book value of the shares or Net Asset Value (NAV). However, the
company needs to give complete disclosure about the basis of valuation in
Explanatory Statement and also in the offer letter which needs to send to the
Shareholders.
TAX
TREATMENT FOR BUYBACK OF SHARES:
As
per the Indian Income Tax Act, 1961 any sum paid from accumulated profit to the
shareholders of the company is treated as a dividend under Section 2(22)(a). In
case of buyback any payment made by a company on purchase of own shares from a
shareholder in accordance with the provisions of Section 68 of the Companies Act,
2013 will not be treated as dividend hence Dividend Distribution Tax (DDT)
under Section 115-O will not be applicable in this case.
AFTER
AMENDMENT BROUGHT BY FINANCE BILL NO. 02, 2019
For Unlisted Shares: – Section 115QA of the Act
provides for the levy of additional Income-tax at the rate of twenty
percent of the distributed income on account of buy-back of unlisted
shares by the company. As additional income-tax has been levied at the
level of the company, the consequential income arising in the hands of
shareholders has been exempted from tax under section 10(34A) of the
Income Tax Act. It is here to be noted that there is not any amendment brought
by Finance Bill 2019 for buyback of shares of Unlisted company.
For Listed Shares: Any buyback of shares from a shareholder
by a company listed on the recognized stock exchange, on or after 5th July
2019, shall also be covered by the provision of section 115QA of the Act.
Accordingly, it is also proposed to extend exemption under section 10(34A) of
the Income Tax Act to shareholders of the listed company on account of buy-back
of shares on which additional income -tax has been paid by the company. These
amendments will take effect from 5th July 2019.
In simple word, now section 115QA shall be applicable in all
the case i.e., Buy Back of both Listed and Unlisted company shares and now
every Company buy backing the shares has to pay tax on distributed income at
the rate of 20% on such distributed income. Consequently, since the company is
already paying the Tax, Amount received by the shareholders shall be exempt
under section 10(34A) of the Income Tax Act in the hand of the shareholder.
APPLICABILITY
OF STAMP DUTY:
No
Stamp Duty is payable in case of buyback of shares as the company is buying
back its own shares and hence, the same does not result in any transfer.
PUNISHMENT
If a company makes any default in complying with the provisions
of section 68, then the punishment shall be as follows:-
|
Company
|
Fine not less than one lakh rupees but which may extend
to three lakh rupees
|
|
Every
officer
|
Imprisonment for a term which may extend to three
years or with fine which shall not be less than one lakh rupees but which may
extend to three lakh rupees, or with both
|
CHECKLIST FOR BUY BACK OF OWN SHARES OR SECURITIES
|
Sr. No.
|
Particulars
|
Yes/ No/NA
|
Remarks
|
||
|
1.
|
Whether Board Meeting is held to
decide the details of proposed buy back of shares? (It is required to
be held)
|
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|
2. (i)
|
Whether the company is authorised to
buy back its shares or securities by Articles of Association (AOA)?
|
||||
|
2. (ii)
|
If No, alteration of AOA is to
be initiated or not? (AOA has to be amended by passing a Special resolution)
File MGT-9 within 30 days.
(If the Resolution of
Buy back and alteration of AOA is done in the same general meeting, then the
Resolution of alteration of AOA should precede the resolution of Buy back)
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|
3. (i)
|
Have you determined the quantum of buy
back of shares? What is the quantum of the shares to be bought back?
|
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|
3. (ii)
|
If the buy back is less than 10% of
paid up equity share capital & free reserve, then Board resolution will
suffice, therefore is the Board resolution passed for the
same purpose?
|
||||
|
3. (iii)
|
But if the buy back is more than 10% but less
than 25% of paid up capital and free reserve then Special
resolution is required, is it passed? (Maximum permissible
in a year is 25% of paid up capital + free reserves )
|
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|
3. (iv)
|
Whether have you checked that Number of
shares to be bought back in respect of Equity shares should not
exceed 25% of its total paid up equity share capital?
|
||||
|
4.
|
Whether the restriction related to buy
back u/s 70 are checked? No buy back will be permitted if the
buyback falls under the clause of Section 70?
(1. through any
subsidiary company including its own subsidiary companies;
2. through any
investment company or group of investment companies; or
3. if any default, is
made by the company, in the repayment of deposits accepted either before or
after the commencement of this Act, interest payment thereon, redemption of
debentures or preference shares or payment of dividend to any shareholder, or
repayment of any term loan or interest payable thereon to any financial
institution or banking company: However, the buy-back is not prohibited, if
the default is remedied and a period of three years has lapsed after such
default ceased to subsist.
4. No company shall,
directly or indirectly, purchase its own shares or other specified securities
in case such company has not complied with the provisions of sections 92 Annual
Return, 123 (Declaration of Dividend), 127 (punishment for failure to
distribute dividend) and section 129 (Financial Statement)
|
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|
5.
|
Whether there is a gap of more than one
year from the closure of previous buy back?
|
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6.
|
If special resolution is to be passed, whether
the notice of the same is given at least 21 days
prior to the date of passing the Special Resolution?
|
||||
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7.
|
Along with Notice, Explanatory Statement also
needs to be provided to Shareholders?
|
||||
|
8.
|
Whether have you checked that explanatory
statement contains all the required information as per SEBI
regulations (for listed companies) and Companies
(Share Capital and Debenture) Rules 2014 (for unlisted companies)?
|
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|
9.
|
Whether Form MGT-14 is filed
with the registrar along with the fees within 30 days from
passing board resolution or special resolution?
|
||||
|
10
|
Whether the company has after passing Special
resolution but before buy back of shares, has filed with the Registrar of
Companies a letter of offer in Form No. SH-8?
|
||||
|
11.
|
Have you verified that Form Sh-8 needs to
be signed by at least 2 directors; out of which
at least one should be Managing director, if any? (verify same condition for
Form SH.9 & Form SH.11 too)
|
||||
|
12.
|
Whether the company has along with Form SH-8,
filed with the Registrar of Companies & SEBI (for listed
companies) a declaration of solvency in Form SH-9?
|
||||
|
13.
|
Have you verified that Form Sh-9 needs to
be signed by at least 2 directors; out of which
at least one should be Managing director, if any in affidavit under rule
17(3)?
|
||||
|
14.
|
Whether have you ensured that letter of
offer is dispatched to the Shareholders or
security holders within 20 days from its filing with
Registrar of Companies?
|
||||
|
15.
|
Whether have you checked that the offer of buy
back has remained open for a period of minimum 15 days and maximum 30
days from the date of dispatch of letter of offer?
|
||||
|
16.
|
If bought back shares are oversubscribed by
the shareholders or security holders, whether the acceptance per shareholder
is done on proportionate basis out of the total shares
offered for being bought back, restricting it to the maximum number of shares
to be bought back?
|
||||
|
17.
|
Whether have you checked that verifications of
shares bought back are completed from the date of closure of the offer of the
offers received within 15 days?
|
||||
|
18.
|
If the shares are to be rejected whether
the communication for rejection of shares has been
made within 21 days from the date of closure of offer?
|
||||
|
19.
|
Has the company immediately after the
closure of the offer, opened a bank account and deposited
therein the total amount payable as consideration for the
shares offered for buy back?
|
||||
|
20.
|
Whether within 7 days from
completion of verification of records, has the company made payment to
shareholder?
|
||||
|
21.
|
Whether within 7 days from
completion of buy back, has the company extinguish and physically
destroy the shares and securities so bought back from the
shareholders?
|
||||
|
22.
|
In case of unlisted companies buy back of shares,
whether within 14 days, company has paid additional tax u/s 115QA
@ 20% on distributed income?
|
||||
|
23.
|
Has the company maintained a register of
shares or other securities which have been bought-back in Form
No. SH.10?
|
||||
|
24.
|
Where is the register maintained & in how’s
custody, who is making entries in that register, is these question in
accordance with the provision of Section 68 or not?
|
||||
|
25.
|
Has the company, after the completion of
the buy-back, filed with the Registrar and with the Securities and
Exchange Board of India (in case of a listed company), a return in
the Form No. SH.11 within thirty days of completion of
buy back?
|
||||
|
26.
|
Is there annexed a certificate in Form
No. SH- 15 to the return filed with the Registrar in Form No. SH-11?
|
||||
|
27.
|
If the company has purchased its shares out
of free reserves or securities premium account, a sum equal to the nominal
value of the shares so purchased shall be transferred to the capital
redemption reserve account?
|
||||
|
28.
|
Whether the buy back is completed within
one year from the date of passing board resolution or Special
resolution?
|
||||
|
29.
|
If there is a default by the
company in any of the above mentioned points, whether the company has been
informed about the penal provisions relating to buy back on
company and every officer of the company?
|
||||
COMMENT: THE EXPLANATORY STATEMENT SHALL
CONTAIN THE FOLLOWING DISCLOSURES NAMELY:-
(a) the date of the board meeting at which the
proposal for buy-back was approved by the board of directors of the company;
(b) the objective of the buy-back;
(c) the class of shares or other securities
intended to be purchased under the buy-back;
(d) the number of securities that the company
proposes to buy-back;
(e) the method to be adopted for the buy-back;
(f) the price at which the buy-back of
shares or other securities shall be made;
(g) the basis of arriving
at the buy-back price;
(h) the maximum amount to be paid for the buy-back
and the sources of funds from which the buy-back would be financed;
(i) the time-limit for the completion of
buy-back;
(j) (i) the aggregate shareholding of the promoters
and of the directors of the promoter, where the promoter is a company and of
the directors and key managerial personnel as on the date of the notice
convening the general meeting;
(ii) the aggregate number of equity shares
purchased or sold by persons mentioned in sub-clause (i) during a period of
twelve months preceding the date of the board meeting at which the buy-back was
approved and from that date till the date of notice convening the general
meeting;
(iii) the maximum and minimum price at which
purchases and sales referred to in sub-clause (ii) were made along with
the relevant date;
(k) if the persons mentioned in sub-clause
(i) of clause (j) intend to tender their shares for buy-back –
(i) the quantum of shares proposed to be tendered;
(iii) the details of their transactions and their
holdings for the last twelve months prior to the date of the board meeting at
which the buy-back was approved including information of number of shares
acquired, the price and the date of acquisition;
(l) a confirmation that there are no
defaults subsisting in repayment of deposits, interest payment thereon,
redemption of debentures or payment of interest thereon or redemption of preference
shares or payment of dividend due to any shareholder, or repayment of any term
loans or interest payable thereon to any financial institution or banking
company;
(m) a confirmation that the Board of
directors have made a full enquiry into the affairs and prospects of the
company and that they have formed the opinion-
(i) that immediately following the date on
which the general meeting is convened there shall be no grounds on which the
company could be found unable to pay its debts;
(ii) as regards its prospects for the year
immediately following that date, that, having regard to their intentions with
respect to the management of the company’s business during that year and to the
amount and character of the financial resources which will in their view be
available to the company during that year, the company shall be able to meet
its liabilities as and when they fall due and shall not be rendered insolvent
within a period of one year from that date; and
(iii) the directors have taken into account
the liabilities(including prospective and contingent liabilities),
as if the company were being wound up under the
provisions of the Companies Act, 2013
(n) a report addressed to the Board of
directors by the company’s auditors stating that-
(i) they have inquired into the company’s state of
affairs;
(ii) the amount of the permissible capital payment
for the securities in question is in their view properly determined;
(iii) that the audited accounts on the basis of
which calculation with reference to buy back is done is not more than six
months old from the date of offer document; and
COMMENT: WHERE THE AUDITED ACCOUNTS ARE MORE
THAN SIX MONTHS OLD, THE CALCULATIONS WITH REFERENCE TO BUY BACK SHALL BE
ON THE BASIS OF UN-AUDITED ACCOUNTS NOT OLDER THAN SIX MONTHS FROM THE
DATE OF OFFER DOCUMENT WHICH ARE SUBJECTED TO LIMITED REVIEW BY THE AUDITORS OF
THE COMPANY.
(iv) the Board of directors have formed the
opinion as specified in clause (m) on reasonable grounds and that the
company, having regard to its state of affairs, shall not be rendered insolvent
within a period of one year from that date.
(2) The company which has been authorized by a
special resolution shall, before the buy-back of shares, file with the
Registrar of Companies a letter of offer in Form No. SH.8 along
with the fee:
Provided that such letter of offer shall be dated
and signed on behalf of the Board of directors of the company by not less than
two directors of the company, one of whom shall be the managing director, where
there is one.
(3) The company shall file with the Registrar,
along with the letter of offer, and in case of a listed company with the
Registrar and the Securities and Exchange Board, a declaration of solvency
in Form No. SH.9 along with the fee and signed by at least two
directors of the company, one of whom shall be the managing director, if any,
and verified by an affidavit as specified in the said Form.
(4) The letter of offer shall be dispatched to the
shareholders or security holders immediately after filing the same with the
Registrar of Companies but not later than twenty days from its filing with the
Registrar of Companies.
(5) The offer for buy-back shall remain open for a
period of not less than fifteen days and not exceeding thirty days from the
date of dispatch of the letter of offer.
COMMENT: WHERE ALL MEMBERS OF A COMPANY AGREE, THE
OFFER FOR BUY-BACK MAY REMAIN OPEN FOR A PERIOD LESS THAN FIFTEEN DAYS
(6) In case the number of shares or other specified
securities offered by the shareholders or security holders is more than the
total number of shares or securities to be bought back by the company, the
acceptance per shareholder shall be on proportionate basis out of the total
shares offered for being bought back.
(7) The company shall complete the verifications of
the offers received within fifteen days from the date of closure of the offer
and the shares or other securities lodged shall be deemed to be accepted unless
a communication of rejection is made within twenty one days from the date of
closure of the offer.
(8) The company shall immediately after the date of
closure of the offer, open a separate bank account and deposit therein, such
sum, as would make up the entire sum due and payable as consideration for the
shares tendered for buy-back in terms of these rules.
(9) The company shall within seven days of the time
specified in sub-rule (7)-
(a) make payment of consideration in cash to those
shareholders or security holders whose securities have been accepted; or
(b) return the share certificates to the shareholders
or security holders whose securities have not been accepted at all or the
balance of securities in case of part acceptance .
(10) The company shall ensure that—
(a) the letter of offer shall contain true,
factual and material information and shall not contain any misleading
information and must state that the directors of the company accept the
responsibility for the information contained in such document;
(b) the company shall not issue any new
shares including by way of bonus shares from the date of passing of special
resolution authorizing the buy-back till the date of the closure of the offer
under these rules, except those arising out of any outstanding convertible
instruments;
(c) the company shall confirm in its offer
the opening of a separate bank account adequately funded for this purpose and
to pay the consideration only by way of cash;
(d) the company shall not withdraw the offer
once it has announced the offer to the shareholders;
(e) the company shall not utilize any money
borrowed from banks or financial institutions for the purpose of buying back
its shares; and
(f) the company shall not utilize the proceeds of
an earlier issue of the same kind of shares or same kind of other specified
securities for the buy-back.
(12)(a) The company, shall maintain a register of
shares or other securities which have been bought-back in Form No.
SH.10.
(b) The register of shares or securities
bought-back shall be maintained at the registered office of the company and
shall be kept in the custody of the secretary of the company or any other
person authorized by the board in this behalf.
(c) The entries in the register shall be
authenticated by the secretary of the company or by any other person authorized
by the Board for the purpose.
(13) The company, after the completion of the
buy-back under these rules, shall file with the Registrar, and in case of a
listed company with the Registrar and the Securities and Exchange Board of
India, a return in the Form No. SH.11 along with the fee .
(14) There shall be annexed to the return filed
with the Registrar in Form No. SH.11, a certificate in Form
No. SH.15 signed by two directors of the company including the
managing director, if any, certifying that the buy-back of securities has been
made in compliance with the provisions of the Act and the rules made
thereunder.
DISCLAIMER: THE ARTICLE IS BASED ON THE RELEVANT
PROVISIONS AND AS PER THE INFORMATION EXISTING AT THE TIME OF THE PREPARATION.
IN NO EVENT I SHALL BE LIABLE FOR ANY DIRECT AND INDIRECT RESULT FROM THIS
ARTICLE. THIS IS ONLY A KNOWLEDGE SHARING INITIATIVE.
THE AUTHOR – CS DEEPAK
SETH (ASSOCIATE PARTNER HELPINGHANDS PROFESSIONALS LLP) AND CAN BE REACHED AT
CONTACTHHPRO@GMAIL.COM OR 9910248911.
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