Section 57: Shares not paid for in cash

57. Shares not paid for in cash (1) Shares shall be deemed not to have been paid for in cash except to the extent that the company has actually received cash in payment of the shares at the time of or subsequently to the agreement to issue the shares. (2) Before shares that have already been issued are credited as fully or partly paid up other than for cash, the Board shall determine the reasonable present cash value of the consideration and shall ensure that the present cash value of the consideration is— (a) fair and reasonable to the company and to all existing shareholders; and (b) not less than the amount to be credited in respect of the shares. (3) A certificate shall be signed by one of the directors or his agent authorised in writing describing the consideration in sufficient detail to identify it and state— (a) the present cash value of the consideration and the basis for assessing it; (b) that the present cash value of the consideration is fair and reasonable to the company and to all existing shareholders; and (c) that the present cash value of the consideration is not less than the amount to be credited in respect of the shares. (4) The Board shall deliver a copy of a certificate issued under subsection (3) to the Registrar for registration within 14 days of its signature. (5) Nothing in this section shall apply to the issue of shares in a company on— (a) the conversion of any convertible securities; or (b) the exercise of any option to acquire shares in the company. (6) Where the Registrar is dissatisfied with the value mentioned in the certificate delivered to the Registrar under subsection (4), the Registrar may refer the matter to the Registrar-General who may assess the value in accordance with section 17 of the Registration Duty Act and section 28 of the Land (Duties and Taxes) Act 1984 and the provisions of those sections including the right of appeal under those sections shall mutatis mutandis apply to a valuation for the purposes of this section. (7) An officer who fails to comply with subsection (3) shall commit an offence and shall, on conviction, be liable to a fine not exceeding 200,000 rupees. (8) Where the Board fails to comply with subsection (4), every officer of the company shall commit an offence and shall, on conviction, be liable to a fine not exceeding 100,000 rupees. [S. 57 amended by s. 4 (d) and (g) of Act 20 of 2002 w.e.f. 10 August 2002.] [Issue 4] C35 – 48 Revised Laws of Mauritius