Amended and updated notes on section 29 of Companies Act 2013. Detail discussion on provisions and rules related to public offer of securities to be in dematerialised form.
Chapter III (Sections 23–42) of the Companies Act, 2013 (CA 2013) deals with the provisions related to prospectus and allotment of securities. Section 29 of CA 2013 provides for public offer of securities to be in dematerialised form.
Recently, we have discussed in detail section 28 (Offer of sale of shares by certain members of company) of CA 2013. Today, we learn the provisions of section 29 of Companies Act 2013 read with the Companies (Prospectus and Allotment of Securities) Rules, 2014.
Section 29 of the Companies Act, 2013 has been notified by the Ministry of Corporate Affairs (MCA) vide Notification No. S.O. 2754(E) issued dated 12.09.2013. This notification was come into force from 12th September, 2013 i.e. the commencement date of section 29 is 12-9-2013.
| Name of Act | The Companies Act 2013 |
|---|---|
| Enacted by | Parliament of India |
| Administered by | Ministry of Corporate Affairs (MCA) |
| Number of Chapters | 29 |
| Number of Sections | 484 (470-43+57) |
| Number of Schedules | 7 |
| You are reading: | |
| Chapter No. | III |
| Chapter Name | Prospectus and Allotment of Securities |
| Section No. | 29 |
| Section Name | Public offer of securities to be in dematerialised form |
| Monthly Updated Edition | Company Law PDF |
Section 29 (Public offer of securities to be in dematerialised form) of Companies Act 2013
Section 29(1):
Section 29(1): The securities shall be issued only in dematerialised form by:
- (a) every company making public offer; and
- (b) such other prescribed class of companies.
Such securities must comply the provisions of the Depositories Act, 1996 and the regulations made thereunder.
The word “public” from clause (b) of sub-section (1) of section 29 was omitted by the Companies (Amendment) Act, 2019 with effect from 15th August 2019.
Section 29(1A):
Section 29(1A): In case of prescribed class of unlisted companies, the securities shall be held or transferred only in dematerialised form in the manner laid down in the Depositories Act, 1996 and the regulations made thereunder.
Section 29(2):
Section29(2): Any other company except mentioned in section 29(1), may:
- convert its securities into dematerialised form; or
- issue its securities in physical form in accordance with the provisions of Companies Act 2013; or
- issue its securities in dematerialised form in accordance with the provisions of the Depositories Act, 1996 and the regulations made thereunder.
If you have any query related to the provisions of section 29, please feel free to ask through comment section below.
Section 29 of Companies Act 2013: Public offer of securities to be in dematerialised form
Section 29 shall come into force on 12th September, 2013 vide Notification No. S.O. 2754(E) dated 12.09.2013.
(1) Notwithstanding anything contained in any other provisions of this Act, —
- (a) every company making public offer; and
- (b) such other class or classes of public companies as may be prescribed,
shall issue the securities only in dematerialised form by complying with the provisions of the Depositories Act, 1996 and the regulations made thereunder.
See Rule 9 of the Companies (Prospectus and Allotment of Securities) Rules, 2014 for more info related to Dematerialisation of securities.
(1A) In case of such class or classes of unlisted companies as may be prescribed, the securities shall be held or transferred only in dematerialised form in the manner laid down in the Depositories Act, 1996 and the regulations made thereunder.
(2) Any company, other than a company mentioned in sub-section (1), may convert its securities into dematerialised form or issue its securities in physical form in accordance with the provisions of this Act or in dematerialised form in accordance with the provisions of the Depositories Act, 1996 and the regulations made thereunder.