law: Companies Act, 1956
  Sec 79    -     Power
  
  to issue shares at a discount 
  (1) A company shall not issue shares at a discount
  
  except as provided in this section.
  (2) A company may issue at a discount shares
  
  in the company of a class already issued, if the following conditions are
  
  fulfilled, namely,
  (i) the issue of the shares at a discount is
  
  authorized by a resolution passed by the company in general meeting, and
  
  sanctioned by the Company Law Board;
  (ii) the resolution specifies the maximum rate
  
  of discount at which the shares are to be issued :
  Provided  that no such resolution shall be
  
  sanctioned by the Company Law Board if the maximum rate of discount specified
  
  in the resolution exceeds ten per cent, unless the Board is of opinion that a
  
  higher percentage of discount may be allowed in the special circumstances of
  
  the case ;
  (iii) not less than one year has at the date
  
  of the issue elapsed since the date on which the company was entitled to
  
  commence business ; and
  (iv) the shares to be issued at a discount are
  
  issued within two months after the date on which the issue is sanctioned by the
  
  Company Law Board, or within such extended time as the Company Law Board may
  
  allow.
  (3) Where a company has passed a resolution
  
  authorizing the issue of shares at a discount, it may apply to the Company Law
  
  Board for an order sanctioning the issue ; and on any such application, the
  
  Company Law Board, if having regard to all the circumstances of the case, it
  
  thinks proper so to do, may make an order sanctioning the issue on such terms
  
  and conditions as it thinks fit.
  (4) Every prospectus relating to the issue of
  
  the shares shall contain particulars of the discount allowed on the issue of
  
  the shares or of so much of that discount as has not been written off at the
  
  date of the issue of the prospectus.
  If default is made in complying with this sub-section, the
  
  company, and every officer of the company who is in default, shall be
  
  punishable with fine which may extend to five hundred rupees.