In case of issue of shares at discount, the rate of discount should not be more than

The correct answer is A. 5%.

The Companies Act, 2013, Section 53(1) states that the issue of shares at a discount is not allowed, except in the following cases:

• Where the shares are issued to employees of the company as part of their remuneration.
• Where the shares are issued to the promoters of the company.
• Where the shares are issued to a financial institution in consideration of the financial assistance provided by it to the company.
• Where the shares are issued to a venture capital fund or a venture capital company in consideration of the financial assistance provided by it to the company.

In all other cases, the issue of shares at a discount is not allowed. The maximum permissible discount on the issue of shares is 5%.

Option B, $$7\frac{1}{2}\% $$ is not correct because the maximum permissible discount on the issue of shares is 5%.

Option C, 10% is not correct because the maximum permissible discount on the issue of shares is 5%.

Option D, 11% is not correct because the maximum permissible discount on the issue of shares is 5%.