08 September 2013
Security premium A/c is a specific one coz.. It can be use for only under few conditions :
in paying up its unissued securities, to be issued to its members as fully paid bonus shares;
in writing off its preliminary expenses;
in writing off the expenses of or the commission paid or discount allowed on any issue of securities or debentures of the company or
in providing for the premium payable on the redemption of any redeemable preference securities or any debentures of the company.
Purchase of its own shares or other specified securities [Section 77A(1)(iii)]
The provisions of, and procedure prescribed for under Sections 100 to 102 of the Companies Act, for reduction of share capital would apply, wherever a company proposes to utilize amounts from the securities premium account, for any other purposes...
CAclubindia
