XYZ Limited has during the financial year 2019-20, made private placement of 15,00,000 equity shares of ₹10 each at a issue price of ₹15 per share as below. No approval of the shareholders has been obtained for the priva

Rule 14 of the Companies (Prospectus and Allotment of Securities) Rules, 2014 prescribes that for the purposes of sub-section (2) and sub-section (3) of section 42 of the Companies Act, 2013, a company shall not make an offer or invitation to subscribe to securities through private placement unless the proposal has been previously approved by the shareholders of the company, by a special resolution for each of the offers or invitations. However, XYZ Ltd. has made Private Placement during the financial year 2019-20 without taking approval of the Shareholders, hence the company has not complied with Rule 14 of the Companies (Prospectus and Allotment of Securities) Rules, 2014.