Startups · Fundraising & Share-Issue Compliance
A term sheet is the easy part. Issuing the shares legally, valuation, board and shareholder approvals, the allotment return, and the RBI reporting if the money came from abroad, is where founders get stuck or non-compliant. We run the whole share-issue process so your cap table is clean and your next round’s due diligence is painless.
Angel, seed or VC money is in and the shares need to be issued and reported correctly.
A convertible note, SAFE or CCPS round that needs the right instrument and conversion mechanics.
An overseas angel or fund invested, FC-GPR and FEMA pricing rules now apply within strict timelines.
A Rule 11UA valuation report is required to price the round and support the allotment.
Past allotments were done loosely and you want it cleaned up before the next round’s diligence.
Money is received and the 30-day clock for the return of allotment has already started.
| Step | What happens |
|---|---|
| Structure the round | Confirm the instrument, equity, CCPS, convertible note or SAFE, and the approvals it needs. |
| Valuation | Coordinate the Rule 11UA valuation (merchant-banker DCF) to price the issue and support the filing. |
| Approvals & offer | Board and shareholder resolutions, and the private-placement offer letter in PAS-4 with PAS-5 record. |
| Allotment | Allot shares in the board meeting, issue share certificates and update the register of members. |
| ROC filing (PAS-3) | File the return of allotment with the MCA within 30 days of allotment. |
| FEMA filing (FC-GPR) | For foreign money, report to the RBI in FC-GPR within 30 days, with the CS and valuation certificates. |
| Instrument | What it is | Key compliance |
|---|---|---|
| Equity shares | Priced round at an agreed valuation | Rule 11UA valuation, PAS-4, PAS-3, FC-GPR if foreign |
| CCPS | Compulsorily convertible preference shares | Conversion terms in AoA, PAS-3, FC-GPR (FDI-compliant instrument) |
| Convertible notes | Debt converting to equity later | Permitted route for recognised startups, with its own FEMA conditions |
| SAFE | Simple agreement for future equity | Structured to fit Indian law; conversion mapped to a future priced round |
Government / statutory cost
Professional fees depend on the instrument, the number of investors and whether foreign reporting is involved. You receive a clear written quote after a short scoping call, no hidden charges, no published menu.
Schedule a 15-minute callNo. Angel tax under Section 56(2)(viib), which taxed share premium received above fair value, has been abolished for all investors with effect from assessment year 2025-26, by the Finance (No.2) Act 2024. Share issues on or after 1 April 2024 are no longer exposed to it. Valuation is still required for company-law and FEMA pricing, but the angel-tax risk is gone.
The allotment should be made and the return of allotment filed in Form PAS-3 with the MCA within 30 days of allotment. For money received under a private placement, the funds must be kept in a separate bank account and allotted within 60 days of receipt, failing which they have to be refunded.
The investment must comply with FEMA pricing guidelines, and the company must report it to the RBI in Form FC-GPR within 30 days of allotment, supported by a company secretary’s certificate and a valuation certificate. Late reporting attracts a Late Submission Fee and possible compounding, so it is set up before allotment.
Yes. For pricing the issue under Rule 11UA, a registered valuer or, for FEMA purposes, a merchant banker issues the report, commonly on a discounted cash flow basis for a priced round. We coordinate the valuation and align it with the company-law and FEMA filings.
CCPS are preference shares that compulsorily convert to equity on agreed terms and are a recognised FDI instrument. A convertible note is debt that converts later, available to DPIIT-recognised startups under specific conditions. A SAFE is a contractual right to future equity, structured to fit Indian law. We pick the instrument that suits your round and investors.
Late PAS-3 attracts additional MCA fees that escalate with delay. Late FC-GPR attracts a Late Submission Fee and can require compounding of the FEMA contravention with the RBI. Both are avoidable by reporting within the 30-day windows, which is how we run it.
Yes. We review past allotments, fix missing resolutions, certificates, PAS-3 or FC-GPR filings, and reconstruct the register of members and cap table, so your next round’s due diligence does not get held up by historical gaps.
Yes, on a dedicated page. DPIIT recognition and the Section 80-IAC three-year tax holiday are separate work that often runs alongside a raise, see our DPIIT / 80-IAC startup recognition service.
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Vijay R Singh & Co., Chartered Accountants · FRN 136869W · ICAI M.No. 153926 · Andheri East, Mumbai, in practice since 2013. References are to the Companies Act 2013, the Income-tax Act (including the Finance (No.2) Act 2024 abolition of Section 56(2)(viib)) and FEMA 1999. General information, not advice until engaged.
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