Read the passage given below carefully and answer the questions given below on the basis of the information.

Nidiya limited was incorporated on 1st April, 2017 with registered office in Mumbai. The capital clause of Memorandum of Association reflected a registered capital of 8,00,000 equity shares of  ₹10 each and 1,00,000 preference shares of  ₹50 each.
Since some large investments were required for building and machinery the company in consultation with vendors, Ms.VPS Enterprises, issued 1,00,000 equity shares and 20,000 preference shares at par to them in full consideration of assets acquired. Besides this the company issued 2,00,000 equity shares for cash at par payable as Rs 3 on application, 2 on allotment, 3 on first call and 2 on second call.
Till date second call has not yet been made and all the shareholders have paid except Mr. Ajay who did not pay allotment and calls on his 300 shares and Mr. Vipul who did not pay first call on his 200 shares. Shares of Mr. Ajay were then forfeited and out of them 100 shares were reissued at  ₹12 per share.

Shares issued to vendors of building and machinery, i.e. Ms. VPS Enterprises, would be classified as which of the following?

Issue for Consideration other than cash

The correct answer is option 3- Issue for Consideration other than cash.

Shares issued to vendors of building and machinery, Ms. VPS Enterprises, would be classified as "Issue for Consideration other than cash." This classification indicates that the shares were issued in exchange for assets rather than cash.

Issue of Shares for Consideration other than Cash: There are instances where a company enters into an arrangement with the vendors from whom it has purchased assets, whereby the latter agrees to accept, the payment in the form of fully paid shares of the company issued to them. Normally, no such cash is received for issue of shares. These shares can also be issued either at par, at premium or at discount, and the number of shares to be issued will depend upon the price at which the shares are issued and the amount payable to the vendor.

OTHER OPTIONS-

• Preferential allotment refers to the issuance of shares to specific individuals or entities on a preferential basis, often at a price or terms different from the market price or terms offered to the public.
• Employee Stock Option Plans (ESOPs) are programs through which a company grants its employees the right to purchase a certain number of shares of the company's stock at a predetermined price within a specified period.
• Right issue of shares allows existing shareholders of a company to purchase additional shares at a predetermined price, usually in proportion to their existing holdings, within a specified period.