Interim Dividiend

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Jitesh Chowdhury (Querist)
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30 September 2008 I would like to know the procedure that is needed to be followed to declare an interim dividend by a private limited company.

CMA Jitendra Singh

CMA Jitendra Singh (Expert)
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30 September 2008 Declare after board consent and deposit the same within 5 days in scheduled bank separately till it further distributed.

DDT will be deposited as per IT provisions

Jitesh Chowdhury

Jitesh Chowdhury (Querist)
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30 September 2008 Is there a ceiling on the number of times a co. could declare an interim dividend?

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S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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30 September 2008 No. The criteria is the company should have sufficient profits to accommodate the dividends and the BOard should be satisfied with that.

Jitender

Jitender (Expert)
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30 September 2008 u can refer to dividend rules made in this behalf.

Jitesh Chowdhury

Jitesh Chowdhury (Querist)
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30 September 2008 acha 1 more thing, what if a co. declares an interim dividend as it had earned profit tilld time of declaration but consequently it incurred an annual loss?

CA Nitin Wadhwani

CA Nitin Wadhwani (Expert)
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02 October 2008 No Problem.
Since it is that Dividend declared out of past profits.

Jitesh Chowdhury

Jitesh Chowdhury (Querist)
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04 October 2008 what if d co. had no past profits n d dividend was paid completely out of d pofits earned during d first 6 months

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Jitesh Chowdhury

Jitesh Chowdhury (Querist)
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04 October 2008 what if d co. had no past profits n d dividend was paid completely out of d pofits earned during d first 6 months

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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07 October 2008 If the interim dividend is not exhorbitant and on account of reasons totally beyond the control of the Board, the second half year turns out to be a loss totally unexpected, there is no violation. But the onus of substantiating that the Board acted prudently lies with the Board. Secondly, till the deficit is made up, the company can not consider further dividends.