Information about Form PAS-6 and Frequently Asked Questions

 The PAS-6 form is used to reconcile share capital on a half-yearly basis. The same would be required to get submitted via the unlisted public companies to the Registrar of Companies (ROC). The major purpose of Form PAS-6 would be needed to notify the information and revise the share capital of the companies on half-yearly grounds. An individual who practices Company secretary (CS) or Chartered Accountant (CA) can certify it.

The Ministry of Corporate Affairs (MCA) launched Form PAS-6 via a notification on 10th September 2018. In the very notification, the MCA has inserted Rule 9A (sub-rule 8) to the Companies (Prospectus and Allotment of Securities), Rules, 2014 via the Companies (Prospectus and Allotment of Securities) Third Amendment Rules, 2019. The same shall furnishes for the problem of securities exclusively in dematerialized form through unlisted public companies from 2nd October 2018.

Read Also:- Know All About MCA Form PAS-6 For Unlisted Public Companies

All about PAS-6 (Reconciliation of Share Capital Audit Report on a Half-Yearly Basis)

• Section 29 of the Companies Act, 2013
• Rule 9A(8) of the Companies (Prospectus and Allotment of Securities) Rules, 2014

Furnishing the reconciliation of the share capital audit report on the half-yearly grounds of the unlisted public companies who had certified from Company Secretary in practice or Chartered Accountant in practice under 60 days from the closure of each half-year.

Read Also:- Frequently Asked Questions (FAQs) on E-form PAS-6 | SAG RTA 

It is not applicable to the unlisted public company which is:

(a) a Nidhi company

(b) a Government company

(c) a wholly-owned subsidiary Rule 9A of the Companies (Prospectus and Allotment of Securities) Rules, 2014.

Form PAS-6 is obligated to be filed for each type of security, viz., equity and preference. The e- form relates only to share capital (equity and preference) and not with respect to debts (debentures, bonds, etc.)

Below is the Form Pas-6 FAQ's

Question - 1. When a company owns multiple securities, does it require to furnish multiple Form PAS-6?

Answer:  Yes

Question - 2. Do debt-listed companies are required to submit Form PAS-6?

Answer:- Yes 

Question- 3. Some security holders does not convert their securities in DEMAT form while the company has received ISIN does the same would be a non-compliance with Section 29 of the Companies Act, 2013 or Rule 9A of the Companies (Prospectus and Allotment of Securities) Rules, 2014, and whether the same is to be qualified in Form PAS-6?

Answer:- When the company has the purpose of ISIN and available utility for Demat to all security holders under rule 9A(4) of the Companies (Prospectus and Allotment of Securities) Rules, 2014 the company then followed on its end.

Unless any issue of securities or buyback of securities happens at the Company level or any security holder seeks the Company for the share transfer there is no time duration mentioned to convert the current securities held in Demat.

But these companies are required to furnish the half-yearly returns and are mandated to specify that the securities would be owned by the members in the physical form.

Question-4. Is there any requirement to attach any documents/ supporting in PAS-6?

Answer:- No, you are not required to attach anything in the form of PAS-6.

Question-5. What is the penalty for late filing when ISIN generation is processing?

Answer:- Penalty under section 450 of the Companies Act, 2013 shall be applied.

Question-6. UDIN would not be needed to be generated for the certification of Form PAS-6?

Answer:- It does not essential

Question-7. In Form PAS-6 shareholding pattern of the promoters, directors, and KMP is to be stated. What happens when the promoters are the directors and they hold 10,000 shares? Would 10,000 shares in the promoters class and 10,000 shares in the directors class be specified? Does the same is not said to be the miscalculation?

Answer:- You can cite any one category and attach clarification

Question-8. What shall be the penalty for late filing of Form PAS-6?

Answer:- Rs.10,000 is a one-time penalty and for continuing default Penalty of Rs.1000 per day on the company, the officer in default under section 450 of the Companies Act, 2013 will be applicable as per maximum of Rs.2,00,000 on the Company and Rs.50,000 per officer in default.

Question-9. What is the last date to file PAS-6?

Answer:-

• The last date to file PAS-6 is 60 days from the conclusion date of each half-year.
• That is Half year ended 31st March: 30th May; and
• Half year ended 30th September: 28th November.

Question-10. Does the promoter, director or KMP would be needed to dematerialize the securities owned via them or the class of securities that the company wants to issue?

Answer:- Prior to issuing any shares all the securities, equity shares, preference shares, or debentures that the promoter owned, director, or KMP would need to be materialized.

Question-11. What is the method to obtain the Demat connectivity through the company?

Answer:- 

• Conduct a board meeting to acknowledge and approve the proposal to take DEMAT connectivity regarding securities with the depositories.
• Appoint a Registrar and Transfer Agent (RTA);
• Post RTA appointment, the company furnishes the application including the related documents with the depository to take DEMAT connectivity:
• The company, depository along with RTA would insert into Tripartite agreement for the securities which would be shown as qualified to be held in dematerialized form;
• Post application verification along with additional documents the depository shall furnsihed DEMAT connectivity to the company and provide ISIN to securities of the company.
• After that, the company shareholders might approach RTA for the dematerialization of their securities.

Question-12. What would be the obtained outcome for the company as well as its shareholders when they do not convert their shares in DEMAT?

Answer:- 

• The company shall not arrive with the below-mentioned things:
• The issue of the new securities with the right issue along with the bonus issue,
• Securities buyback 
• Shareholders are not able to transfer their securities.

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How to Choose the Right R&T Agent for Mutual Fund Services

Mutual fund investors usually need to create multipal transactions, like buying or selling their investment groups, switching between various funds, or updating their personal details like bank details or addresses. It’s useful for each of these requests to be recorded correctly and kept safe as part of the shareholder's history.

Handling a large number of these transactions can be quite challenging. It needs good systems, information on regulations, & dedicated support. Instead of managing everything on their own, MF companies can partner with specialized service providers that are experts in handling investor-related requests efficiently.

One key player in this step-by-step is the RTA (Registrar and Transfer Agent). They help MF (mutual fund) companies by taking care of transaction processing, maintaining investor records, managing data, and addressing multipal service requests. By relying on an experienced RTA for these operational tasks, mutual fund companies can ensure that records are accurate, improve the services they offer to investors, and spend more time focusing on managing their funds effectively.

An R&T agent helps mutual fund companies with record maintenance, via offices all over the country. Computer Age Management Services SAG RTA, (Cams), Karvy, and Deutsche Investor for RTA Services are the major agents. An R&T agent possesses a wide network of branches all over the country, which helps the investors to get forms of fund houses, finish their transactions, and receive their account statements. The same acts as a single-window system for investors.

A Registrar & Transfer Agent assists the investors with the data on the new fund offers, dividend distributions, or even the maturity dates in the case of FMPs (fixed maturity plans). But this information is available via houses; an R&T agent provides data for all. The investors could obtain the data for several investments in various policies of distinct fund houses in a single place.

Through the stand of mutual funds, R&T agents provide effective services and help in saving costs. Since R&T agents have offices all over the country, they are considered branches for the mutual funds that they provide and assist them in their sales mechanism. Normally, investors seem to invest in various policies of various fund houses. Under the compliance of the Securities and Exchange Board of India, there is a cut-off time when the investment needs to be made to qualify for that day's NAV.

Thus when the investor needs to make numerous investments, he would be required to ask various fund houses. Rather than that, he would use Registrar & Transfer Agent Services to run all his transactions and make the investments.

The mutual fund house furnishes the money for the services that R&T agents provide. The charges rely on the transaction volume performed towards the mutual funds. The mutual fund then takes fees for these types of expenses to the expense ratio of the fund. As an investor during the execution of the transactions at the R&T agent's office, you would not be required to furnish any charges.

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Difference Between Listed and Unlisted Company

Basically, there are two basic types of companies i.e. listed and unlisted companies. Both share the same goal of profit maximization, but there are many key differences between them.

Other than size, structure, and way of raising capital, their ownership is the fundamental difference between both. While the listed companies are owned by many shareholders, non-listed or unlisted companies are owned by private investors.

Listed Company

A company to be listed on the stock exchange will be considered a listed company. Someone can freely trade its shares on the stock exchange, and investors can buy and sell shares at their discretion. Such investors after purchasing the shares become shareholders of the company. 

A company has the option to be listed on the main market (for bigger and established companies) of the stock exchange or in the alternative investment market (for relatively new companies).

A board of directors appointed by shareholders takes all the decisions of a listed company. This board consists of both executive and non-executive directors. Various corporate governance requirements often specify and govern board creations.

All the decisions made by boards need to be shared with shareholders in a timely manner, and board resolutions should be passed in making some important decisions. Shareholders are entitled to two types of returns by investing in a listed company.

Dividends

Dividends is money paid by a company at regular intervals from its profit to its shareholders. While some shareholders prefer to cash in dividends, others choose to reinvest their part into a business known as the dividend reinvestment concept.

Capital Gains

Capital gain is defined as the net profit that an investor makes after selling capital/investment for more than the purchase price of the property. The entire value earned from selling a capital asset will be considered as taxable income.

There are various rules and regulations listed companies are liable to follow along with some definite requirements to fulfill in terms of preparation of financial statements.

There are standard formats for major financial statements which include a statement of financial position, income statement, statement of cash flows, and statement of change in equity. Further, these statements must have to be prepared and submitted in accordance with the Generally accepted accounting principles (GAAP).

The Sarbanes-Oxley Act 2002 is an important regulatory act developed especially for the reporting and disclosure requirements of listed companies, and it protects the interests of investors.

During the last few decades, such regulatory acts remained consistently strict because of large corporate scandals such as Enron (2001) and WorldCom (2002)

Unlisted Company

Companies that are not listed on the stock exchanges are known as unlisted companies. We also know these companies as privately held companies. As they are not listed on the stock exchange thus they can’t raise finance through share offers to public investors. Meanwhile, they can issue shares to well-known parties such as family and friends to increase equity.

Shares are traded "over the counter", where the specifics of the deal can be tailored to the requirements of the parties (buyers and sellers) involved; Thus, the exchange of control doesn’t take place in the case of an Unlisted company. Unlisted companies have better control over their business functions.

Listing on the stock exchange is not mandatory for a company to be successful. Unlisted companies also have some benefits, as financial results reporting requirements are not subject to strict rules, thus being flexible and less complex.

Difference between Listed and Unlisted Company?

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All You Need to Know About E-Form PAS-6 Filing FAQs

The PAS-6 form was notified by the Ministry of Corporate Affairs (MCA) on 15th July 2020. The due date for filing the PAS-6 form by companies governed by the Rule 9A of the Companies Rules, 2014 was 13th September 2020, however, the MCA has extended the due date till 31st December 2020.

Q.1 – What is Rule 9A?

The Ministry of Corporate Affairs through the notification released on 10th September 2018 introduced Rule 9A under Companies (Prospectus and Allotment of Securities), Rules, 2014. The said rule is concerned with the issue of securities in Demat form by Unlisted Public Limited Company in India and became effective from 02nd October 2018.

According to Rule 9A,

Every unlisted public company shall –

• issue all future securities only in dematerialised form; and
• Convert all its existing securities into Demat form

This shall be done according to the provisions and regulations of the Depository Act, 1996.

Q.2 – What is Dematerialization?

Dematerialization refers to the process of converting physical share certificates into electronic forms, which aims to enhance transparency, security, and corporate governance.

Q.3 – What Are The Various Features of Rule 9A?

• Every unlisted public company is required to issue future securities only in Demat form and must also convert all its existing securities into Demat (with unique ISIN for each type of security).
• Before the company can make an offer for the issue of securities, it must convert all securities of its promoters, directors, KMP in Demat form.
• Every securities holder of such a company must get their securities converted into Demat form before they can transfer it to another person.
• Submission of reconciliation of share capital audit report.
• Security holders of the company shall file their grievances directly before the IEPF Authority.

The said rules of Rule 9A shall also be applicable to Deemed Public Companies, i.e. private companies which are subsidiaries of a public company. The rule, however, shall not apply to an unlisted public company which is either a Nidhi or a government company or a wholly-owned subsidiary.

Q.4 How to File PAS-6?

The PAS-6 form must be filed by every unlisted public company which is governed by Rule 9A. The form will be submitted to the Registrar of Companies along with such fees as provided in Companies (Registration Offices and Fees) Rules, 2014 and must be filed within 60 days from the completion of a half year. Did you want to find out about the best RTA Agent? if yes then you can choose our SAG RTA: A SEBI authorized Rajasthan's 1st Registrar and Share Transfer Agent Services provider company.

Any of the following persons are authorized to file PAS-6 on behalf of his/her company:

• Director
• Manger
• Company Secretary
• CEO
• CFO

Q.5 What is PAS-6 Filing Frequency & Due Date?

An unlisted public company is required to file two PAS-6 forms in a year for the following category of securities:

Q.6 – How to Obtain ISIN?

Any eligible company can obtain ISIN by filing a request with the concerned authority. If a company fails to obtain ISIN, they will be liable to pay a penalty under Section 450 of Companies Act, 2013 (punishment where no specific penalty or punishment is provided).

Can a company still file PAS-6 if it has not dematerialized its shares by 31st March 2020?

Yes. In such a case the company must provide details of physical shares in the column that says “shares held in physical form”.

Read also: All You Need to Know About Filing of E-Form PAS-6 by Unlisted Public Companies

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