However, as per the SEBI (ICDR) Regulations, if a company fails to receive 90% of the total issue, all application moneys received shall be refunded to the applicants within:
(a) 15 days of the closure of issue in case the issue is not underwritten; and
(b) 70 days of the closure of issue in case the issue is underwritten.
In case of delay in the refund, company shall have to pay interest at the rate of 15% per annum.
(2) Failure to get permission from the stock exchange for listing:
Where permission for listing having been applied for has not been granted by the Stock Exchange(s) before the expiry of 10 weeks from the date of the closing of the subscription list (or in case appeal is preferred against refusal by the stock exchange by the company to the Central Government/Securities Appellate Tribunal, till the appeal is finally disposed off), the company is required to return all money received from the applicants without interest within 8 days after the company becomes liable to pay it.
In case of default, the company and every director of the company, who is an officer in default, shall be jointly and severally liable to repay that money with interest at the rate of 15% per annum. (Sec. 73).
(3) Return of excess application money in case permission is granted by stock exchange [Sec. 73 (2A)]:
Where permission has been granted by the recognised stock exchange(s) and the moneys received from applicants for shares are in excess of the aggregate of the application money relating to the shares in respect of which allotments have been made, the company shall repay the moneys to the extent of such excess forthwith without interest.
If such money is not repaid within 8 days, from the day the company becomes liable to pay it, the company and every director of the company who is an officer in default shall, on and from the expiry of the eighth day, be jointly and severally liable to repay that money with interest at the rate between 4-15 %, as may be prescribed, having regard to the length of the period of delay in making the repayment of such money.