Conditions for issue of debentures.

Ans. Conditions for issue of debentures are

(1) The Allotment must be absolute & unconditional.

(2) (a) Copy of prospectus must be filed with Registrar prior to issue of Debentures. (b) In case of Debentures issued privately statement in ‘Lieu of Prospectus should have been filed with the Registrar of companies by the company.

(3) The Debenture application money should have been deposited in the Board of Directors.

(4) The decision of the Board to allot debenture must be communicated to the applicant by means of a Allotment letter.

(5) the decision of the Board to allot debenture must be communicated to the applicant by means of Allotment letter.

(6) The entire allotment must be completed within 120 days from the date of issue of prospectus.


(7) Debenture must be allotted within 3 months of allotment.