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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Star Ltd. issued 10,000 shares of ₹10 each, payable ₹4 on application, ₹3 on allotment, ₹2 on first call, and the balance on second and final call. 500 shares were forfeited. Calculate the ‘Maximum Permissible Discount’ and ‘Minimum Reissue Price’ on reissue in each of the following cases, assuming the reissued shares are fully paid-up: Case 1: forfeited for non-payment of the second and final call. Case 2: forfeited for non-payment of the first call and second and final call. Case 3: forfeited for non-payment of allotment, first call, and second and final call. Case 4: forfeited for non-payment of allotment and first call; the second and final call is not yet made.
Rule (Companies Act, 2013, Section 53): the discount on reissue cannot exceed the amount forfeited (received) on the reissued shares, and the reissue price cannot be less than the amount already received by the company on those shares.
MAXIMUM PERMISSIBLE DISCOUNT AND MINIMUM REISSUE PRICE
| Case | Maximum Permissible Discount | Minimum Reissue Price |
|---|---|---|
| 1: Forfeited for non-payment of Second and Final Call only (₹9 received: App + Allotment + First Call) | ₹9 | ₹1 |
| 2: Forfeited for non-payment of First Call and Second and Final Call (₹7 received: App + Allotment) | ₹7 | ₹3 |
| 3: Forfeited for non-payment of Allotment, First Call and Second and Final Call (₹4 received: App only) | ₹4 | ₹6 |
| 4: Forfeited for non-payment of Allotment and First Call; Second and Final Call not yet made (₹4 received: App only) | ₹4 | ₹6 |
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Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "T.S. Grewal Class 12 Vol 2 Chapter 1 Q.59 - Share Capital", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 1 - Share Capital.
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