Issue of additional shares to existing members of co-op.hsg.
Vaidyanathan
(Querist) 03 March 2017
This query is : Resolved
We are an existing co-op. Hsg. Soc.in mumbai under Maharashtra CHS act. Currently each membet is holding 5 shares of Rs.50/ each totalling Rs.250/-.
We now adopted the new byelaw and as per bye law no.19(c)(ii) it states member to hold 20 shares.
Question:1. Are we now suposed to issue further 15 shares.
2. In this case the paid up share capital will increase.
What is the procedure for completing the above process.
V. Vaidyanathan
Guest
(Expert) 03 March 2017
Mr. Vaidyanathan,
Unless you have authorised share capital to that extent, as approved through resolution of the AGM, and finally got assented by the Reistrar of societies, you can't issue additional shares. Mere mention of the members to have 20 shares can't suffice.
Paid up share capital can't exceed the authorised share capital, if not approved formally.
Guest
(Expert) 03 March 2017
Mr. Vaidyanathan,
Unless you have authorised share capital to that extent, as approved through resolution of the AGM, and finally got assented by the Reistrar of societies, you can't issue additional shares. Mere mention of the members to have 20 shares can't suffice.
Paid up share capital can't exceed the authorised share capital, if not approved formally.
Guest
(Expert) 04 March 2017
Usha ji,
Thanks for agreeing with me.
Vaidyanathan
(Querist) 07 March 2017
Thank you Shri P. S. Dhingra. Our authorised share capital is Rs.5,00,000/- consisting of 10,000 shares of Rs.50/-each as approved while registration of our society in 1995. Our paid up share capital is Rs.69,500/- only issued to 278 members having been issued 5 shares to each member (total 1390 shares) of Rs.50/- each (total amount Rs.69500/-} My question is, is it mandatory to issue additional shares on adopton of new bye law (bye law No.19(c)(ii)} adopted by our society to make it 20 shares to each member, if so what is the procedure. Please be informed that additional units (flat) cannot be added since there is no provision or space.
Guest
(Expert) 07 March 2017
Are you sure, bye law No.19(c)(ii) relates to issue of shares to individuals and does not deal with anything else?
If so, can you reproduce the extract of the said bye law No.19(c)(ii)?
Vaidyanathan
(Querist) 07 March 2017
Sorry it is 19(a)(ii) under Conditions of Membership it says--- applicant has fully paid the value of atleast 10 shares of the society along with his application for Membership.
As if now as per old bye law we have issued only 5 shares to each member.
Guest
(Expert) 07 March 2017
According to your own description and under the provision of new byelaws, the society can compel the members to get additional 5 shares, rest at the discretion of the members, may they apply for more shares even beyond the limit of 20 share.
However, if a resolution is passed by the AGM to make it compulsory for the members to acquire 20 shares and the byelaws are also amended by the scociety with due approval of the registrar the society can issue shares up to the number approved by the AGM. Otherwise not.
