Please let me know whether a company can issue bonus shares out of "Capital Reserves" which are not ear-marked for any specific purpose.
CS Ankur Srivastava
(Company Secretary & Compliance Officer)
(17853 Points)
Replied 12 June 2009
Dear Rakesh,
Bonus issue is the capitalization of the accumulated profits of the company. It can only be issued only from the free reserves of the company. If it is distributable to the shareholders then bonus shares can be issued using it.
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