X Ltd. received a quotation from the brokers contemplating for ₹10 Crore of Commission to procure a subscription for its public issue of Equity Shares with a nominal value of ₹100 Crore at an issue price of ₹150 Crore. T

As per Rule 13(c) of the Companies (Prospectus and Allotment of Securities) Rules, 2014, the rate of commission paid or agreed to be paid shall not exceed: 5% of the price at which shares are issued or A rate authorised by articles of Association whichever is less. Therefore, the payment of commission by the company shall not exceed the following: 5% of issue price (150 Crore *5%): ₹7.5 Crore 4% of issue price as authorised by articles: ₹6.0 Crore Whichever is less, i.e. ₹6 Crore can be paid However, in case, the issue price is ₹250 Crore, the commission can be paid up to ₹10 Crore (₹250 crore *4%)