ESOP Vesting and Forfeiture Tracking in Pune

Pune's equity-heavy employers cluster tightly, the Rajiv Gandhi Infotech Park in Hinjewadi, the SaaS and product floors of Magarpatta, the EON IT Park belt in Kharadi, the Viman Nagar startup pocket, the Baner-Balewadi corridor, and the manufacturing units around Chakan and MIDC. What they share is movement: engineers and product hires rotate between these parks constantly, and every move is a forfeiture waiting to be recorded. That is the gap a founder's spreadsheet cannot hold.

The reason this needs a managed service rather than a once-a-year clean-up is timing. Vesting is a calendar event that happens whether anyone logs it; forfeiture is a people event that fires the day someone resigns in Kharadi or a plant role turns over in Chakan. Miss either, and the vested-versus-unvested split on your cap table stops matching the SH-6 register, usually surfacing the week a Mumbai or Bengaluru investor opens the data room. We close that gap by tracking and posting each event as it happens, so reconciliation is never a reconstruction.

Whether your option holders sit on a product floor in Magarpatta or a shop floor near MIDC Chakan, the deliverable is the same: a single source of truth where the live schedule and the statutory book agree. Here is the work that keeps them agreeing:

• Tranche-level vesting: each grant is broken into its tranches and walked to its vesting date, holder by holder, so the vested count is always a fact, not an estimate.
• Exit handling against scheme terms: when a Kharadi developer or a Chakan supervisor leaves, we apply the good-leaver or bad-leaver clause, forfeit the unvested portion, and send it back to the pool.
• Dated SH-6 postings: every grant, vest, exercise and forfeiture is written into Form SH-6 with its date and cause as it occurs.
• Two-way alerts: the company hears about upcoming vests and exercise deadlines in advance, while a leaver's exercise window is flagged before it closes.
• Holder notifications: employees are told the day their options vest, so equity stays something they can see and value.
• A pool that closes: granted, vested, exercised and forfeited always reconcile back to the authorised pool, ready to show.

Ask any founder in Hinjewadi or Magarpatta where their cap table last went wrong, and the answer is usually a leaver no one logged. Forfeiture is unlike vesting: it has no scheduled date, it fires the moment a person resigns, and what happens next depends entirely on how they left. The matrix below is the rulebook we apply on every exit.

Every forfeiture must be entered in the Form SH-6 register with its date and cause, with the forfeited options returned to the pool so it reconciles. Take a Chakan manufacturer whose floor supervisor resigns mid-cliff: we catch the exit, apply the scheme's good-leaver or bad-leaver terms, and post the SH-6 entry, so nothing slips through and the pool stays correct.

The failure points we see most in Pune are specific to how its companies grow, fast hiring in the IT parks, frequent inter-park moves, and a funding round that arrives before the records are ready.

All fees and charges listed are indicative only and do not constitute a binding offer. Final amounts may vary depending on the volume of work and the complexity involved.

Professional service charges for drafting, filing, and representation are separate from the statutory fees. The exact fee depends on the complexity of the case, disputed amount, and number of hearings required. Contact us for a detailed quote.

Get a free ESOP Vesting Tracking consultation - Call +91 945 945 6700 or WhatsApp us. No-obligation assessment.

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Pune-incorporated companies file with the Registrar of Companies (RoC) Pune under the Maharashtra jurisdiction, and a large share of the city's option-issuing employers sit in three clusters we work with closely: the Hinjewadi and Magarpatta IT parks, the Kharadi and Viman Nagar startup hubs, and the Baner-Balewadi tech corridor. These are services-heavy, high-attrition teams, which is exactly where unrecorded forfeitures pile up.

The standard Indian grant most Pune startups run, a four-year schedule with a one-year cliff, means roughly a quarter of each grant vests at month twelve and the rest monthly or quarterly thereafter, so the vested and unvested split moves every single month. We track that for each tranche, post leaver forfeitures to SH-6 against the scheme's good-leaver and bad-leaver terms, and keep the option pool reconciled. Patron Accounting LLP is a CA and CS firm with 15+ years of this work, with a Pune presence plus offices in Mumbai, Delhi and Gurugram, serving clients in person and remotely.

A frequent worry from Pune option holders, especially first-time grantees at a Baner or Viman Nagar startup, is that each monthly vest creates a tax bill. It does not. Vesting is purely a record event; tax enters the picture only later, at exercise and at sale. Keeping that distinction clean is exactly what this tracking does, while the perquisite tax at exercise sits with payroll, not here.

A company incorporated in Pune sits under the jurisdiction of the Registrar of Companies (RoC) Pune, and its ESOP-related corporate filings, such as the MGT-14 for the special resolution approving the scheme and the PAS-3 return of allotment on exercise, are filed through the MCA21 portal against that RoC. The Form SH-6 register itself is not filed; it is kept at the registered office and produced on inspection. The statutory basis is the same nationwide:

Vesting: under Rule 12 of the Companies (Share Capital and Debentures) Rules, 2014, there must be a minimum of one year between grant and vesting; the scheme sets the full vesting schedule and the treatment of options on separation.

Forfeiture: unvested options lapse or are forfeited on separation as the scheme provides, and vested options are exercisable only within the scheme's post-termination window, after which they may lapse.

SH-6 register: Rule 12(10) requires the company to maintain the Form SH-6 register recording all grants, vesting, exercise, lapse and forfeiture; it is not filed with the MCA but must be available for inspection in audits and diligence.

Non-compliance: failure to maintain the register or comply with Rule 12 can attract penalties under the Companies Act, alongside the reputational and trust cost of inaccurate records.

Authoritative sources: the Ministry of Corporate Affairs (Rule 12, SH-6, Section 450), the Companies Act and Share Capital Rules, and the Income Tax Department (perquisite at exercise, capital gains).

The cost of not tracking is invisible until it is not: a year of unrecorded vesting and forfeitures surfaces in an audit or a due-diligence exercise, where reconstructing it is slow, expensive and reputationally awkward, and where a pool that does not reconcile raises real questions. Tracking continuously, for a modest annual fee, means the record is always right and there is never a reconstruction to do. Keep the schedule and register live, not retrospective.

Vesting and forfeiture are the moving parts of every ESOP, and keeping them tracked, recorded and communicated is what keeps the scheme accurate, compliant and trusted.

Patron Accounting LLP, a CA and CS firm with 15+ years of ESOP experience, runs this as an affordable annual subscription, tracking vesting milestones, recording forfeitures in SH-6, alerting the company and notifying employees, so your records stay live and audit-ready, and pairs it with full register administration and management whenever you need more.

Start with the national ESOP Vesting and Forfeiture Tracking service, then explore complementary ESOP services across India.

• ESOP Vesting and Forfeiture Tracking in India - the national parent service
• ESOP Services Hub - the full ESOP advisory hub - route by stage, scenario or tax
• ESOP Scheme Design - design the option pool, vesting schedule and leaver terms
• ESOP Valuation Services - Rule 11UA fair-market-value reports for grants and exercises
• ESOP Corporate Filings - MGT-14, PAS-3 and Form SH-6 register filings
• ESOP Perquisite Tax (Sec 17(2)(vi)) - perquisite tax and TDS computation at exercise

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