One of our client companies has received share application money in April 2015 but shares have not been allotted so far. And now company doesn’t want to allot shares on the amount so received. Kindly advice whether we can return that amount now.
Refund of Application Money.—
(1) If the stated minimum amount has not been subscribed and the sum payable on application is not received within the period specified therein, then the application money shall be repaid within a period of fifteen days from the closure of the issue and if any such money is not so repaid within such period, the directors of the company who are officers in default shall jointly and severally be liable to repay that money with interest at the rate of fifteen percent per annum.
(2) The application money to be refunded shall be credited only to the bank account from which the subscription was remitted.