Select the TRUE statement related to the issue/re-issue of equity shares.

The question tests understanding of the legal provisions regarding issue and re-issue of equity shares, particularly concerning discount and premium.

Analyzing the options:

Option 1: Equity shares can be issued (fresh issue) at discount -Not permitted under the Companies Act, 2013, subject to specified statutory exceptions.

Option 2: Equity shares can be re-issued at discount - This is TRUE and is the correct answer. When shares are forfeited for non-payment of calls, the company can re-issue these forfeited shares. The re-issue can be at par, at premium, or even at a discount.

The only restriction is: Discount on re-issue ≤ Amount forfeited on those shares

For example, if ₹30 was forfeited on shares with face value ₹100, they can be re-issued at a discount up to ₹30 (i.e., minimum re-issue price = ₹70).

Option 3: Shares cannot be issued at premium - This is false. Companies routinely issue shares at premium (above face value) as per Section 52 of the Companies Act.

Option 4: Shares cannot be re-issued at premium - This is false. Forfeited shares can be re-issued at premium, at par, or at discount.

The key distinction is between:

• Fresh issue → Cannot be at discount (with rare exceptions)
• Re-issue of forfeited shares → Can be at discount (within the forfeited amount limit)