PAS-4 Filing Guide 2025: Complete Checklist for Indian Companies | Deadlines & Penalties

Under Section 42 of the Companies Act, 2013, Indian companies (private and public) must issue a PAS-4 offer letter before allotting securities through private placement. 

Most founders discover PAS-4 requirements mid-fundraise when lawyers start throwing around terms like "private placement offer letter" and "deemed public offer." If you miss the PAS-4 due date or exceed investor limits, you could be staring at hefty penalties, refund obligations, or worse, regulatory scrutiny.

This guide gives private companies a clear, up-to-date checklist to avoid those pitfalls and issue PAS-4 with confidence.

Here’s what you’ll find: rules, timelines, penalties, and a complete PAS-4 checklist. Let’s get started.

What is PAS-4?

PAS-4 is the Private Placement Offer Letter that Indian companies must issue when raising funds from select investors. This document also serves as a formal invitation to potential investors and outlines the terms and conditions of the securities being offered.

The Ministry of Corporate Affairs (MCA) governs the PAS-4 form for private placement under the Companies Act, 2013. 

It includes important details about the securities being offered (their type, the number available, the price, and the terms and conditions of the offering) and also about the issuer (company name, registered address, and financial statements).

First up: What is a private placement?

Private placement is when companies raise funds by offering securities directly to select investors, instead of the general public. 

It must be made only through a formal offer letter approved by the board (without any public advertisements, marketing, or media outreach). If publicly promoted, the offer is deemed a public issue, not a private placement.

It comes with tight compliance rules. 

Rule 14(2) of the Companies (Prospectus and Allotment of Securities) Rules, 2014 restricts private placement offers to a maximum of 200 investors per financial year. This excludes QIBs and employees receiving shares under ESOPs. 

The 200-investor cap applies to each security type separately. NBFCs and Housing Finance companies are exempt from this restriction.

Who needs to file PAS-4?

Any company (whether private or public) raising capital through a private placement or preferential allotment under Section 42 of the Companies Act, 2013, must issue PAS‑4. It must be addressed to the “identified persons” selected by the board.

Historically, companies were required to file a copy of the PAS-4 offer letter along with the record of offers (Form PAS-5) with the Registrar of Companies (ROC). 

The Companies (Prospectus and Allotment of Securities) Second Amendment Rules, 2018, removed the mandatory requirement for companies to file PAS-4 and PAS-5 with the ROC.

While companies no longer need to file PAS-4 with the ROC, they must still issue it to investors and maintain it as part of their statutory records.

When should PAS-4 be issued?

Form PAS‑4 must be circulated to identified investors by the company within a strict timeline. 

According to Rule 14(3) of the Companies (Prospectus and Allotment of Securities) Rules, 2014, the company must issue PAS‑4 within 30 days of recording the names of the selected persons to whom the private placement offer is made. 

And it must be serially numbered, addressed personally to each offeree, and sent only via permitted modes (registered post, speed post, or electronic means).

Heads up: Before the company can make a private placement of its securities, it must satisfy key preconditions under Rule 14(2):

• Hold a board meeting to approve the list of offerees and key offer terms (security type, price, use of funds, payment mode).
• Record the board resolution in the minutes.
• Call an EGM and circulate the draft special resolution with pricing justification.
• Pass the special resolution with at least 75% shareholder approval.
• File MGT‑14 with the ROC, along with the resolution and investor list.
• The minimum investment threshold must be ₹20,000 per person.
• Payment must come only from the subscriber’s own bank account, and the company must keep a bank record proof.

PAS-4 filing checklist for Indian Companies

Before you circulate a single offer letter, take a moment to run through the essentials. Private placement compliance isn’t just about filling forms: it begins well before PAS‑4 is issued. 

We have put together a clear, step-by-step PAS-4 checklist to make sure your documentation, approvals, and investor list are in order before you proceed.

You’re welcome to make a copy and use it as a reference.

What could go wrong with the PAS-4 filing?

Private placement filings are tightly regulated, and failure to comply with PAS‑4 requirements can lead to serious consequences under Section 42(10) of the Companies Act, 2013.

If a company:

• Issues PAS‑4 without passing a special resolution,
• Circulates PAS‑4 to unapproved persons,
• Fails to issue it within 30 days of finalising the offeree list, or
• Violates the mode of delivery or offer cap,
  

…it is treated as a deemed public offer, triggering penalties and a complete breakdown of the private placement shield.

What are the penalties for non-compliance with private placement provisions, including PAS-4?

As per Section 42(10), the penalties are:

• The company, along with its promoters and directors, is liable to a penalty of up to ₹2 crore or the amount raised, whichever is lower.
• In addition, the company must refund all monies collected through the offer, along with interest, within 30 days of the penalty order.

In a 2023 case, Turnaround Systems Pvt. Ltd. was penalised for delayed filing of PAS‑4 during a private placement. The company had conducted the process properly, but missed the deadline for filing the offer letter. 

On appeal, the Regional Director considered the company’s financial distress and moved toward closure, and reduced the penalty to ₹74,250 (10% of the original amount) each for the company and its directors. 

This case also highlights that compliance is non-negotiable. 

Closing the loop on compliance with PAS-4 filing

Private placement compliance is about timing, tracking, and documentation. Here’s a quick rundown of what we’ve seen so far and how to stay compliant:

• Track offer timelines carefully: Ensure PAS‑4 is issued within 30 days of board approval.
• Maintain clean subscriber records: Details like investment amount, bank account used, and mode of delivery must be properly documented and available for inspection.
• Coordinate across teams: Legal, finance, and operations must stay aligned to avoid delays in filing PAS‑3, issuing securities, or maintaining the PAS‑5 record.
• Use designated bank accounts: Funds received via private placement must flow through a separate bank account, not operational accounts.

Compliance ≠ chaos (If you use the right tools)

Manual tracking leaves too much room for oversight, especially when raising multiple rounds or issuing different security types.

EquityList helps companies stay organized and compliant by offering:

• A dynamic cap table that reflects new allotments instantly
• Securities dematerialization with ease
• Auto-generated documents like share certificates and resolution templates
• Centralized investor and security records to simplify audits and due diligence

Want to see how it works in action? Contact us for a walkthrough.

FAQs on the PAS-4 form for private placement

1. Is PAS 4 required to be filed with ROC?

No. Since the 2018 amendment via the Companies (Amendment) Act, PAS‑4 (offer letter) and PAS‑5 (record of allottees) no longer need to be filed with the ROC or SEBI. Companies must only issue and maintain them internally.

2. Is PAS-4 mandatory for all share allotments?

PAS‑4 is mandatory only when raising funds via private placement or preferential allotment under Section 42. It’s not required for rights issues, bonus issues, or public offerings.

3. Can PAS-4 be sent via email?

Yes. Rule 14(3) explicitly allows serialized PAS‑4 forms to be sent in writing or “electronic mode” (which includes email), as long as each is personalised and addressed to the identified person.

4. What’s the difference between PAS-3 and PAS-4?

PAS‑4 refers to the Private Placement Offer Letter issued before fundraising, to invite selected investors and communicate terms.

PAS‑3 is the Return of Allotment, filed after shares or debentures are allotted. It must be filed with the ROC within 15 days of allotment, and the company cannot use the funds received until PAS‑3 is filed.