Further issue of shares by a public co. is governed by Sec.81. Gist of the Section is as under:
1) If the issue is to be made within 2 years of its incorporation or after expiry of one year from the allotment of shares made for the first time after incorporation, whichever is earlier, Sec.81 will not apply and the Board is competent to make allotment.
2) If the issue is to be made after the period specified in (1) above, Board can issue the shares provided the same are issued to the existing shareholders only on proportionate basis ("rights issue").
3) If the issue is to be made after the period specified in (1) above, but not on proportionate basis ("rights issue"), special resolution has to be passed u/s 81(1A)(a). Further, if the co. is unlisted, it has to follow Unlisted Public Cos. (Preferential Allotment) Rules 2003 and obtain certificate from Statutory Auditors for compliance of the Rules.