Section 14(1) in The Companies (Prospectus and Allotment of Securities) Rules, 2014
(1)For the purposes of sub-section (2) and sub-section (3) of section 42, a company shall not make an offer or invitation to subscribe to securities through private placement unless the proposal has been previously approved by the shareholders of the company, by a special resolution for each of the offers or invitations:Provided that in the explanatory statement annexed to the notice for shareholders' approval, the following disclosure shall be made:-(a)particulars of the offer including date of passing of Board resolution;(b)kinds of securities offered and the price at which security is being offered;(c)basis or justification for the price (including premium, if any) at which the offer or invitation is being made;(d)name and address of valuer who performed valuation;(e)amount which the company intends to raise by way of such securities;(f)material terms of raising such securities, proposed time schedule, purposes or objects of offer, contribution being made by the promoters or directors either as part of the offer or separately in furtherance of objects; principle terms of assets charged as securities:Provided further that this sub-rule shall not apply in case of offer or invitation for non-convertible debentures, where the proposed amount to be raised through such offer or invitation does not exceed the limit as specified in clause (c) of subsection (1) of section 180 and in such cases relevant Board resolution under clause (c) of sub-section (3) of section 179 would be adequate:Provided also that in case of offer or invitation for non-convertible debentures, where the proposed amount to be raised through such offer or invitation exceeds the limit as specified in clause (c) of sub-section (1) of section 180, it shall be sufficient if the company passes a previous special resolution only once in a year for all the offers or invitations for such debentures during the year.
