Rule 8 of the Companies (Share Capital and Debentures) Rules, 2014

This rule applies to all companies except listed companies issuing sweat equity shares to its directors or employees. The rule prescribes that the sweat equity shares shall be issued at a price determined by a Registered Valuer as the fair price giving justification for such valuation. Also, the value of the intellectual property or know-how or any other value additions, for which the sweat equity shares have been issued to its directors or employees shall be determined by a valuation report of a Registered Valuer. If the sweat equity shares are issued for a Non-Cash consideration, the value of such non-cash consideration shall be based on a valuation report by a Registered Valuer. Additionally, if the sweat equity shares are issued pursuant to acquisition of an asset, the value of such asset shall also be determined based on a valuation report by a Registered Valuer.

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