If funds are already credited to the company’s bank account (especially in case of a foreign/NRI investor) before complying with the Companies Act, 2013 private placement provisions, you are dealing with an ex-post-facto compliance situation.

You cannot fully “undo” the past, but you can regularize it by following these corrective steps under Section 42 of the Companies Act, 2013, and filing for condonation or compounding if necessary.

✅ Step-by-Step Process to Regularize Private Placement (Post-Receipt of Funds)

🔹 1. Identify the Nature of Investment

• Confirm that the investor is an NRI and funds came from an NRE account.
• Confirm that shares are to be allotted under private placement (not rights or preferential issue).

🔹 2. Hold Board Meeting (Backdated Resolutions Not Allowed)

Pass current board resolution to:

• Approve private placement offer.
• Fix issue price (based on valuation report).
• Approve draft PAS-4.
• Call Extra-Ordinary General Meeting (EGM).

🔹 3. Obtain Valuation Report

• From a registered valuer (for Companies Act) and/or merchant banker/CA (for FEMA).
• Report should specify fair value of shares.

🔹 4. Conduct EGM and Pass Special Resolution

Pass Special Resolution under Section 42 and 62(1)(c) for issuing shares on a private placement basis.

File:

• MGT-14 (within 30 days of EGM) for special resolution.

🔹 5. Issue PAS-4 (Private Placement Offer Letter)

• Issue to the subscriber along with application form.
• Since funds are already received, obtain a letter from subscriber confirming that this is for the offer.

🔹 6. Allotment of Shares

• Pass another board resolution to allot shares to the subscriber.
• Allot shares within 60 days of receiving funds (already breached – needs reporting and compounding).

🔹 7. File PAS-3 (Return of Allotment)

• File within 15 days of allotment.
• Attach:
  • List of allottees.
  • Valuation report.
  • Board resolution.
  • PAS-4 and application form.

If delay occurred, file PAS-3 with additional fee and prepare for compounding.

🛠️ What to Do if Timelines Are Already Breached?

🟡 Late Filing or Procedural Lapse?

• File PAS-3 and MGT-14 late with additional fee.
• Record reason for delay (e.g., ignorance, COVID, etc.).

🔴 Substantive Violations?

If:

• Shares allotted after 60 days of fund receipt.
• No prior offer letter was issued.
• Private placement done without resolution.

Then apply for:

• Compounding under Section 42 with Regional Director (RD).
• Condonation of delay under Section 460 if Central Government approval is needed.

📂 Required Documents for Regularization

• Board Resolutions.
• EGM notice and special resolution.
• Valuation certificate.
• PAS-4 and application form.
• Bank statement for fund receipt.
• FC-GPR (if FDI involved).
• KYC of NRI.
• Copy of MGT-14, PAS-3 filings.

🛡️ Practical Tips

• Maintain a compliance note explaining the corrective steps.
• Keep investor correspondence confirming investment intent.
• File compounding application proactively to avoid penalties and disqualification.

Would you like a sample board resolution, PAS-4 draft, or compounding application format to help you through this process?