Page 103 - KRCL ENglish

iv) Non Compliance of Section 42 of the Companies Act 2013
The share application money received for 2nd right issue is not kept in a separate
bank account in a scheduled bank and the company has not allotted shares within 60
days from the date of receipt of amount to one of the shareholder - Government of
Karnataka of Rs. 19 Crores.
The company has allotted the shares after 229 days from the date of receipt of share
application money, contrary to the provisions of section 42 of the Companies act 2013
which says that if the company is not able to allot the securities within that period, it
shall repay the application money to the subscribers within fteen days from the date
of completion of sixty days and if the company fails to repay the application money
within the aforesaid period, it shall be liable to repay that money with interest at the
rate of twelve percent per annum from the expiry of the sixtieth day. As informed since
the share application amount was received in 2 tranches the share capital is issued
after receipt of nal instalment.

The details of non-allotment of shares within 60 days are as under:

Amount in
Details of Share Application money pending allotment Date
Rs. Crores
Share application money from shareholder – Government of
19.10.2019 19.00
st
Karnataka – 1 Instalment

Share application money from shareholder – Government of
20.04.2020 10.40
nd

Karnataka – 2 Instalment

Total amount of share application received 29.40
Shares allotted out of share application money received 03.06.2020 29.40

st
No. of days utilised for allotment of shares for 1 Instalment 229 Days
Requirement of section 42 of the Companies Act for issue of
60 Days 19.00
shares from the date of receipt of application money
Shares issued beyond the above stipulated date 169 Days

v) There is a difference of Rs. 214.02 Crores in authorized share capital as per records of
Ministry of Corporate Affairs – MCA (Rs. 8293.53 Crore) and as per company's records
(Rs. 8079.51 Crores). At the time of increase in authorized share capital for issue of
Preference Shares, based on the approval of The Cabinet Committee on Economic
Affairs (CCEA) for 1st restructuring, the request for increase in Authorized Share
Capital to Rs. 4293.53 Crores was submitted to Government and resolution was

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