Regarding transfer of unpaid dividend to iepf

This query is : Open

Sathyan Avinash (Querist)
Follow

27 October 2012 Dear Experts,

We all know that by virtue of section 205A, any amount of unpaid dividend remaining unclaimed for a period of 7 years or more need to be transferred to the IEPF.

What are the penal consequences of not doing so ?

Whether penalty as stated in section 205A would be attracted or some other provisions will get attracted ?

Dear Experts kindly throw light upon this matter.

Thank you,

With regards,

Sathyan
e-mail id: sathyanavinash@gmail.com

CS Ankur Srivastava

CS Ankur Srivastava (Expert)
Follow

27 October 2012 Under Section 205C, the specified amount if remain unpaid for 7 years will be transferred to the Investor Education and Protection Fund, within 30 days from the date it became due to transfer.

Sathyan Avinash

Sathyan Avinash (Querist)
Follow

29 October 2012 Dear Ankur,

My query is what are the penal consequences of not transferring the said amount to IEPF.

In my web search, many quote the residual penalty levied under section 629A as the consequence of such non transfer.

But according to me the penalty for such non - transfer of unpaid dividends to IEPF is contained in section 205A(8) itself. Which states that the company and every officer in default is liable to penalty upto Rs. 5000/- per day for such continuous offence.

I would like to know whethe my view is correct.

I back my view as section 205A only contains provisions as to transfer of unpaid dividend to IEPF and as such sub section 8 of the said section contains penalty for non- compliance of the section.

Experts views solicited.

Upgrade to CAclubindia Pro. Subscribe Now!