Private Placement Section 42 (6) -
Application money and its utilisation
1) After making offer allot its securities
within sixty days from the date of receipt of the application money
2) in case not able to allot the securities within that period, repay within 15 days from the expiry of sixty days
3) Failure to repay
the application money within the aforesaid period, it shall be liable to repay that money with
interest at the rate of 12% from the expiry of sixtieth day
4) After offer, the application money shall be
kept in a separate bank account in a scheduled bank and shall not be utilised
for any purpose
other than—
(a) for adjustment
against allotment of securities; or
(b) for the repayment
of monies where the company is unable to allot securities.
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