Section 26 of CA 2013 : Section 26: Matters To Be Stated In Prospectus

Explanation using Example

Imagine a tech startup, "InnovateX", is transitioning from a private to a public company and seeks to raise capital through an Initial Public Offering (IPO). To inform potential investors, InnovateX prepares a prospectus containing detailed financial reports, a declaration of compliance with relevant laws, and statements by directors. This prospectus is dated, signed by the directors, and filed with the Registrar before being published.

However, InnovateX must ensure the prospectus is issued within 90 days of filing to remain valid. If InnovateX fails to comply with these requirements, such as omitting necessary information or not filing the prospectus on time, the company could face a fine ranging from fifty thousand to three lakh rupees, and responsible parties could be penalized similarly.