PAS-3 (Return of Allotment)

What Is PAS-3 (Return of Allotment)?

PAS-3 is the e-form an Indian company files with the Registrar of Companies (RoC) every time it allots shares or other securities — to a founder, an employee, an existing shareholder, or a foreign investor. It is not optional and it is not a one-time filing: every fresh allotment, at every funding round, triggers a fresh PAS-3.

The form's own header states its statutory basis: it is filed "pursuant to Section 39(4) & 42(9) of the Companies Act, 2013 read with Rule 12 & 14 of the Companies (Prospectus and Allotment of Securities) Rules, 2014." In practice, PAS-3 is what converts a board resolution allotting shares into a public record — until it is filed, the company's official register of members and its paid-up capital as seen by the Registrar of Companies do not reflect the new shareholding.

Legal Basis

Section 39(4) — General Allotments

Section 39(4) of the Companies Act, 2013 is the general rule: "Whenever a company having a share capital makes any allotment of securities, it shall file with the Registrar a return of allotment in such manner as may be prescribed." This covers ordinary equity allotments, preference share allotments, and allotments on conversion of debentures or loans — any event that changes who holds what in the company.

Section 42(8) — Private Placement

Section 42 governs private placement — an offer of securities to a select group of identified persons rather than to the public. Since the Companies (Amendment) Act, 2017 replaced the section with effect from 7 August 2018, the return-of-allotment duty for this route has sat in Section 42(8): a company making any allotment under the section "shall file with the Registrar a return of allotment within fifteen days from the date of the allotment in such manner as may be prescribed, including a complete list of all allottees." Section 42(9) is the penalty for missing that deadline rather than the filing duty itself, even though the PAS-3 form header on the MCA portal still carries the older 42(9) reference. Section 42(4) adds a commercial consequence founders often miss: a company "shall not utilise monies raised through private placement unless allotment is made and the return of allotment is filed with the Registrar in accordance with sub-section (8)."

Rule 12 and Rule 14 of the PAS Rules, 2014

Rule 12 of the Companies (Prospectus and Allotment of Securities) Rules, 2014 sets out what must accompany the return: a complete list of allottees, and — where the securities were issued for consideration other than cash — the relevant valuation report and the contract or arrangement under which the non-cash consideration was accepted. Rule 14 layers on the private-placement-specific particulars, including the category of persons to whom the allotment was made.

Filing Deadline: 30 Days, or 15 Days for Private Placement

The form itself states two separate clocks, both running from the date of allotment recorded in the board resolution:

• General allotment: within 30 days of the date of allotment.
• Private placement: within 15 days of the date of allotment.

The 15-day private-placement window is materially tighter than the general 30-day rule, and the form enforces it directly — if "Private Placement" is selected as the category of allotment, the date-of-allotment field must fall within 15 days of the filing date or the form will not validate.

Fee for Filing PAS-3

The filing fee depends on the company's nominal share capital at the time of filing:

A company without share capital pays a flat ₹200. A Nidhi company pays ₹1 for every ₹100 (or part) of the total nominal value of securities issued, capped at the fee for the highest share-capital slab above.

Additional Fee for Delay

Filing PAS-3 late does not stop the RoC accepting it — it multiplies the fee. The additional fee is a straight multiple of the normal fee above, based on how late the filing is measured from the due date:

These multiples apply on top of the base fee from the table above — they are not a separate flat penalty, and they scale with how overdue the return is, which is why a founder who forgets PAS-3 for six months pays substantially more than one who files it 20 days late.

MCA’s instruction kit adds a repeat-offender rule. A higher additional fee becomes payable where a company has been late with PAS-3 on two or more occasions within 365 days of the last such belated filing, and once that flag is switched on it stays on until the company files a PAS-3 at the normal fee. Where the higher additional fee applies, the ordinary additional fee is not charged as well.

Penalty for Not Filing

The multiplied fee is not the only consequence of a late or missing return. For a general allotment, Section 39(5) makes the company and its officer who is in default liable to a penalty, for each default, of ₹1,000 for each day the default continues or ₹1,00,000, whichever is less. For a private placement the exposure is larger and reaches further: under Section 42(9), if the company defaults in filing the return of allotment within the period prescribed under Section 42(8), the company, its promoters and its directors are liable to a penalty of ₹1,000 for each day of default, up to ₹25,00,000.

What Must Accompany the Return

Beyond the company's own particulars and the allotment details, PAS-3 requires:

• A list of allottees — mandatory for private companies, showing who received securities and how many.
• Particulars of the securities allotted — nominal amount, premium or discount, and amounts received on application and on allotment.
• A valuation report, where any part of the consideration for the securities was other than cash.
• The contract or document recording the terms of any non-cash consideration.
• For a private placement: the category of persons to whom the offer was made, with the private-placement declaration enabled and completed.

Who Must Sign and Certify PAS-3

The form is digitally signed by a Director, Managing Director, Manager, Company Secretary, CEO, or CFO of the company, using their DIN, PAN, or membership number as applicable.

Separately, PAS-3 must be certified by a practising professional — a Chartered Accountant, Cost Accountant, or Company Secretary in whole-time practice. This certification is optional only for a One Person Company (OPC) or a small company; every other company must obtain it before filing.

Types of Allotment PAS-3 Covers

The form's own allotment-type field lists categories including bonus issue and private placement, alongside the underlying security type — equity shares, preference shares, or debentures. Whatever the occasion for the allotment, the same PAS-3 form and the same statutory clock apply; the private-placement category is simply the one that shortens the deadline to 15 days and switches on the additional private-placement particulars.

PAS-3 and Foreign Investors: the FC-GPR Link

When the allottee is a person resident outside India and the issue is reckoned as foreign direct investment, the allotment triggers a second filing that runs in parallel to PAS-3 but goes to a different regulator: Form FC-GPR, filed with the Reserve Bank of India under FEMA. The reporting regulations require an Indian company issuing equity instruments to a person resident outside India to report the issue in Form FC-GPR "not later than thirty days from the date of issue of equity instruments" — so both filings key off the same underlying event and both run on a 30-day clock. PAS-3 tells the Registrar of Companies who now holds the company's securities; FC-GPR tells the RBI that foreign capital has entered against those securities. A foreign-invested company that allots shares needs to track both deadlines, since a foreign investor's shares can be validly allotted and recorded on the RoC register through PAS-3 while the company is still separately non-compliant on the FEMA reporting side, or vice versa.

Why PAS-3 Matters for a Foreign Company

For a foreign company setting up or investing in an Indian subsidiary, PAS-3 is the filing that makes an allotment real in the eyes of the Registrar of Companies. Until it is filed, the company's own compliance record shows share capital that does not match its paid-up capital as actually subscribed and paid for. This matters directly at three points common to foreign investment: the first allotment on incorporation, every subsequent funding round, and any allotment of ESOP shares to employees once options are exercised. Missing the 30-day (or 15-day) window does not undo the allotment, but it does mean paying a multiplied fee, and it leaves the company's public RoC record temporarily out of step with its actual capital structure — a mismatch that due-diligence teams in a later funding round or acquisition will flag.

Practical Example

An Indian subsidiary of a US parent allots 10,000 equity shares to the US parent on 5 January, against a fresh equity infusion, following a board resolution passed the same day. The company has a nominal share capital of ₹50,00,000.

The company must file PAS-3 with the RoC by 4 February (30 days from allotment) — the base fee, per the table above, is ₹500. In parallel, because the allottee is a person resident outside India, the company must also file Form FC-GPR with the RBI within 30 days of the same allotment date. If the company instead completes the allotment under Section 42 as a private placement to a specified list of investors including the US parent, the PAS-3 deadline shortens to 15 days from allotment — 20 January — even though the FC-GPR clock still runs the full 30 days.

Common Mistakes

• Treating PAS-3 as a formality that can wait. The additional fee scales sharply with delay — up to 12 times the normal fee past 180 days — so a filing left for "later" during a busy funding round becomes materially more expensive.
• Missing the shorter 15-day private-placement deadline. Teams that default to assuming "30 days" for every allotment file late whenever the allotment was made under Section 42's private-placement route.
• Forgetting the valuation report for non-cash consideration. Where any part of the allotment is against consideration other than cash, the return is incomplete without the accompanying valuation report and the underlying contract.
• Filing PAS-3 without checking the parallel FC-GPR obligation. A correctly and promptly filed PAS-3 does not satisfy the separate FEMA reporting duty when the allottee is a non-resident — the two filings go to different regulators and neither substitutes for the other.

Frequently Asked Questions

Is PAS-3 required for every single share allotment?

Yes. Section 39(4) applies whenever a company having a share capital makes any allotment of securities, so PAS-3 is filed after each allotment event — not just the company's first issue of shares. A company that raises multiple funding rounds files a separate PAS-3 for each round.

What is the deadline for PAS-3 after a private placement?

15 days from the date of allotment, shorter than the general 30-day rule under Section 39(4), because Section 42(8) attaches its own tighter timeline to the private-placement route. Until that return is filed, Section 42(4) bars the company from using the money it raised.

Does a foreign investor's allotment need anything besides PAS-3?

Yes. When the allottee is a person resident outside India, and the issue counts as foreign direct investment, the company must separately file Form FC-GPR with the RBI, not later than thirty days from the date of issue of the equity instruments. PAS-3 and FC-GPR are two different filings to two different regulators.

Who has to certify Form PAS-3?

A Chartered Accountant, Cost Accountant, or Company Secretary in whole-time practice must certify the form. The only exception is a One Person Company or a small company, for which this professional certification is optional.

What happens if PAS-3 is filed late?

The RoC still accepts it, but the filing fee is multiplied — 2 times the normal fee if filed within 30 days of the due date, rising to 12 times once the delay exceeds 180 days, with a higher additional fee for a company late on two or more occasions in 365 days. A statutory penalty also runs: ₹1,000 a day capped at ₹1,00,000 under Section 39(5), or ₹1,000 a day up to ₹25,00,000 on the company, its promoters and its directors under Section 42(9) for a private placement.

See also: FC-GPR, Paid-Up Capital, and Registrar of Companies (ROC) and MCA.

Allotting shares to a foreign investor and need both PAS-3 and FC-GPR handled correctly and on time? Beacon Filing manages ROC and FEMA filings for foreign-invested Indian companies.