Under Rule 9B of the Companies (Prospectus and Allotment of Securities) Rules, 2014, a private company that is not a small company or a government company must issue securities only in dematerialised form and facilitate the demat of all its securities. The date to comply is 18 months from the year-end at which the company first stops being small; for most companies it has passed.
Rule 9B of the Companies (Prospectus and Allotment of Securities) Rules, 2014 was inserted by a notification dated 27 October 2023. Every private company other than a small company must issue securities only in dematerialised form and facilitate the dematerialisation of all its securities. Government companies are exempt (Rule 9B(6)).
Applies / Does not apply
Some charges are set by the depository and the registrar, not by the government.
Board resolution approving dematerialisation
For a company that was not small on 31 March 2023 the date has passed, and later cohorts have passed or are close. A company that has not yet complied should deal with it now; we work out your date from the answers you give and help you plan the steps.
No offers until insiders are in demat: The company cannot make an offer, buy-back, bonus or rights issue until its promoters, directors and key managerial personnel hold their securities in demat form (Rule 9B(3)).
Each point follows from how the process works.
ISIN coordination with the depository: We coordinate the admission and the ISIN with the depository.
For private companies that are not small companies and not government companies, yes, under Rule 9B. Small companies and government companies are outside it. A private company is small if its paid-up capital is up to ₹10 crore and turnover up to ₹100 crore and it is not a holding or subsidiary company.
It is 18 months from the close of the financial year at the end of which the company was not a small company, and the test repeats every year. For a company that was not small on 31 March 2023 it was 30 June 2025 (originally 30 September 2024). Producer companies have five years from the close of the year. Later cohorts get their own 18 months, and we work out your date from your answers.
A private company with paid-up capital up to ₹10 crore and turnover up to ₹100 crore (limits from 1 December 2025; earlier ₹4 crore and ₹40 crore). A holding or subsidiary company, a Section 8 company or a company under a special Act cannot be a small company. What the new limits mean for a company that has already dematerialised is not settled, so we review such cases.
Not for a company covered by Rule 9B. The company must issue securities in demat form, and its promoters, directors and key managerial personnel must dematerialise their holdings before a bonus or rights issue.
Yes. It is a half-yearly reconciliation of share capital audit, filed within 60 days of the end of each half-year (by 30 May and 29 November) with a certificate from a practising professional, even when nothing has changed (Rules 9A(8) and 9B(5)). We offer it as a separate recurring service.
Promoters, directors and key managerial personnel must do so before certain offers. Other holders may stay on paper until they want to transfer shares or subscribe to new securities, and then they must first hold in demat form (Rule 9B(3) and (4)).
Rule 9B has no penalty of its own. The company cannot make certain offers until the insiders' holdings are in demat form, and the general penalty of section 450 (₹10,000 and a further ₹1,000 a day, up to a cap we confirm) can apply.
A unique identifier for a security, issued through the depository. Each type of security of the company needs one.
No. Unlisted public companies fall under Rule 9A, which has applied to them since 2018.
No. Government companies are exempt (Rule 9B(6)).
No. Demat is a one-off set-up, while PAS-6 repeats every half-year. We offer PAS-6 as a separate recurring service, which you can add when you order.