Day 2/365 Compliance Series for Directors | Section 29 Non Compliance | MCA Penalty | #csvikashverma

*Section 29 of the Companies Act, 2013* primarily deals with **public offer of securities to be in dematerialised form**. Here's a concise explanation along with the **consequences of non-compliance**: --- 🔍 *Section 29: Public Offer of Securities to Be in Dematerialised Form* #### ✅ *Key Provisions:* 1. **Public Companies making a public offer**: Securities must be issued in **dematerialised (demat) form only**. They must comply with the provisions of the *Depositories Act, 1996* and relevant SEBI regulations. 2. **Certain Class of Unlisted Companies**: The *Central Government may prescribe* classes of unlisted public companies that must issue and hold securities in demat form. 3. *Private Companies* (not generally covered unless notified under specific rules). --- ⚠️ *Non-Compliance Consequences:* #### 1. *Invalid Allotment or Offer:* Issuing securities in *physical form* when required to be in demat form can make the offer **void or non-compliant**, leading to legal and regulatory action. #### 2. *Penalties under Section 450* (if no specific penalty provided): **Company and every officer in default**: **Fine up to ₹10,000**, and For **continuing contravention**, additional fine up to **₹1,000 per day**. #### 3. *SEBI Action* (for listed companies or companies making public offers): SEBI may impose **monetary penalties**, **suspend trading**, or **restrict access to capital markets**. #### 4. *Registrar of Companies (ROC) Notices:* Non-compliant companies may get notices from the ROC. Could lead to **inspection, inquiry, or adjudication proceedings**. --- 🛡️ *Best Practices to Ensure Compliance:* File all public offer-related documents with SEBI and ROC on time. Ensure timely dematerialisation before issuing securities. Maintain coordination with a registered **depository participant (DP)**. For unlisted public companies, follow **Rule 9A of Companies (Prospectus and Allotment of Securities) Rules, 2014**. --- Would you like a short script or explanation of this for a YouTube video or presentatio