Section 13(1) in Companies (Share Capital and Debentures) Rules, 2014
(1)For the purposes of clause (c) of sub-section (1) of section 62, If authorised by a special resolution passed in a general meeting, shares may be issued by any company in any manner whatsoever including by way of a preferential offer, to any persons whether or not those persons include the persons referred to in clause (a) or clause (b) of sub-section (1) of section 62 and such issue on preferential basis should also comply with conditions laid down in section 42 of the Act:[Provided that in case of any preferential offer made by a company to one or more existing members only, the provisions of sub-rule (1) and proviso to sub-rule (1) and proviso to sub-rule (3) of rule 14 of Companies (Prospectus and Allotment of Securities) Rules, 2014 shall not apply.] [Inserted by Notification No. 210(E), dated 18.3.2015 (w.e.f. 31.3.2014).][Provided further that] [Substituted by Notification No. 210(E), dated 18.3.2015 (w.e.f. 31.3.2014).] the price of shares to be issued on a preferential basis by a listed company shall not be required to be determined by the valuation report of a registered valuer.Explanation.- For the purposes of this rule, (i) the expression 'Preferential Offer' means an issue of shares or other securities, by a company to any select person or group of persons on a preferential basis and does not include shares or other securities offered through a public issue, rights issue, employee stock option scheme, employee stock purchase scheme or an issue of sweat equity shares or bonus shares or depository receipts issued in a country outside India or foreign securities;(ii)the expression, "shares or other securities" means equity shares, fully convertible debentures, partly convertible debentures or any other securities, which would be convertible into or exchanged with equity shares at a later date.
