MCA has introduced a new Form Pas-6: Reconciliation of Share Capital Audit report

Last Updated On: July 20, 2020, 5:53 p.m.


In the month of September 2017, The Ministry of Corporate Affairs had struck off 2,00,000 companies from the record of Registrar of Companies and that were suspected to be ‘shell companies’ and they also instructed the banks to restrict their operation of those ‘shell companies’ bank accounts.

What are shell companies?

Shell Companies are those who do not file their Income Tax return and ROC form correctly and properly on time. These companies manipulate their financial transactions before filing their returns.

It is also found there are Benami shareholding in these companies. It is difficult to find the real owner of the shares and the shareholders are untraceable and there is no transparency in the shareholdings of the Company.

Accordingly, MCA has issued a Notification No. 853(E) dated 10.09.2018 as Companies (Prospectus and Allotment of Securities) Third Amendment Rules, 2018. The Notification is regarding the issue of securities in the dematerialized form by the Unlisted Public Companies only.

This Notification has come into effect from 2nd October 2018. By the Third Amendment Rules, 2018, a new Rule 9A was inserted first time after existing Rule 9 of Companies (Prospectus and Allotment of Securities) Rules, 2014

As per the new rule 9A, UPC should issue their securities only in the Demat form and should also take necessary steps to facilitate the dematerialization of all its existing securities of the Company in accordance with the provisions of Depositories Act 1996.

Now, no UPC can issue securities in the physical form after 2nd October 2018. W.e.f. 2nd October 2018, every UPC which offers the issue of any securities or buyback of securities or issue of bonus shares or right issue or Private Placement shall issue the shares only in dematerialized form.

MCA introduced a new form i.e. Form PAS-6 [Reconciliation of Share Capital Audit Report (half-yearly)] which is basically used for the reconciliation of the share capital audit report on the half-year basis. Form PAS-6 is introduced w.e.f 30.09.2019 in pursuance to the sub-rule (8) of rule 9A of the Companies (Prospectus and Allotment of Securities) Rules, 2014.

So, Form PAS-6 has to be filed within sixty days from the conclusion of each half-year (i.e. on 30th September and 31st March).  All information shall be furnished for the hall year ended 30th September and 31st March in every financial year for each ISIN separately.


Non-Applicability of rule 9A:

The Rule 9A of Companies (Prospectus and Allotment of Securities) Rules, 2014 not applicable to UPC which is: –

(a) a Nidhi;

(b) a Government Company;

(c) a Wholly owned subsidiary.


Important Key points to remember:

  • If a UPC has different types of securities i.e  Equity, Preference, Debenture such a company has to obtain different ISIN and has to file different PAS-6 for each category of securities.
  • All information should be furnished half year ended 30th September and 31st March in every financial year for each International Securities Identification Number (ISIN) separately. Therefore, every UPC has to obtain ISIN for each type of security.
  • If any UPC has not dematerialized its existing securities and not obtain ISIN for each type of securities, form PAS-6 cannot be filed as on date.
  • There is no penalty prescribed under Rule 9A Companies (Prospectus and Allotment of Securities) Rules, 2014 for non-compliance, therefore section 450 of the Companies Act, 2013 (punishment where no specific penalty or punishment is provided) will be applicable.


Content of E-form Pas-6:

  • ISIN (International Security Identification Number).
  • Details of the capital of the Company held in dematerialized form or physical form.
  • Details of changes in share capital during the half-year.
  • Details of shares held by promoters, directors, and KMPs in the form of Demat or physical.
  • Details of the number of requests, number of shares, and reasons for delay for requests confirmed after 21 days or requests pending beyond 21 days.
  • Details of Company Secretary of the Company, if any.
  • Details of Practicing CA/CS certifying this form.

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