BONUS ISSUE OF SHARES

A company may, if its Articles provide so, capitalize profits by issuing fully paid-up shares to the members thereby transferring the sums capitalized from the profit and loss (P&L Account) Account or Reserve Account to the Share Capital.1 Such Shares are known as bonus shares and are issued to the existing members of the company free of charge. The Issue of Bonus Shares is regulated by the regulations issued by SEBI in this regard.

Regulation for Issue of Bonus Shares in accordance to the Amendment of 2012

Section 205 Clause (3) of The Indian Companies Act, 1956