Private Placement- Section 42 of Companies Act| Complete Guide with Rule 14 (PAS-3, PAS-4, PAS-5)

Welcome to this comprehensive video on Private Placement under Section 42 of the Companies Act, 2013, read with Rule 14 of the Companies (Prospectus and Allotment of Securities) Rules, 2014.

In this session, we decode the complete legal framework, process, timelines, forms, penalties, and FAQs — in a clear read-and-present style that’s easy to follow for Company Secretaries, Chartered Accountants, compliance officers, and law students.

🧩 In this video, you’ll learn:

✅ What is Private Placement under Section 42
✅ Who are “identified persons” and the 200-person limit
✅ When to pass Board Resolution vs Special Resolution
✅ Rule 14 requirements – Form PAS-4, PAS-5, PAS-3
✅ Process of issue, receipt of money, and allotment
✅ Time limits for allotment and refund (60 days + 15 days)
✅ Penalties up to ₹2 crore and 12% interest rule
✅ Practical FAQs and latest amendments till 2025
✅ Special provisions for Nidhi, NBFC, and IFSC companies
✅ Common compliance mistakes and how to avoid them

🕒 Timestamps (Suggested for Chapter Marking):

00:00 – Introduction
01:25 – Meaning of Private Placement (Section 42 Explained)
03:50 – Who Can Participate & 200 Person Limit
06:30 – Approvals Required | Board vs Shareholders
10:15 – Offer Document | Forms PAS-4 & PAS-5
13:40 – Subscription Money & Bank Account Requirements
16:10 – Allotment Timelines & Refund Rules
18:30 – ROC Filing | Form PAS-3 Details
21:00 – Penalties & Deemed Public Offer Concept
22:15 – Exemptions for NBFCs, Nidhis & IFSC Companies
– Common Compliance Mistakes
– Summary & Key Takeaways

Key Legal References:

Section 42 of Companies Act, 2013

Rule 14 of Companies (Prospectus and Allotment of Securities) Rules, 2014

Companies (Amendment) Act 2017, 2020 & 2022

MCA Notifications & PAS Forms (PAS-3, PAS-4, PAS-5)


Company Secretaries & Practising Professionals

CA & Law Students

Corporate Compliance Teams & Legal Officers

Entrepreneurs raising private capital

“Private placement is a powerful fundraising route — but one non-compliance can turn it into a deemed public offer. Follow Section 42 and Rule 14 meticulously to stay compliant.”
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