Issue of application forms for securities :

Section 33 of the Act relating to the issue of application forms for securities says that –

(1) The form of application for the purchase of any of the securities of a company shall be issued along with an abridged prospectus.

As per the definition contained in the section 2(1) of the Companies Act, 2013, abridged prospectus means a memorandum containing such salient features of a prospectus as may be specified by the Securities and Exchange board by making regulations in this behalf.

Exceptions: There are, however, certain exceptions to the above provision, where an abridged prospectus containing all the prescribed details need not accompany the Application Forms sent out. These exceptions are:

(a) in connection with a bona fide invitation to a person to enter into an underwriting agreement with respect to such securities; or

(b) in relation to securities which were not offered to the public.

(2) A copy of the prospectus shall, on a request being made by any person before the closing of the subscription list and the offer, be furnished to him.

(3) If a company makes any default in complying with the provisions of this section, it shall be liable to a penalty of fifty thousand rupees for each default.