Experts please help.
Whether it is manadatory to pay dividend within 30 days from date of AGM?
What are the consequences if it is not paid during the above time period?
Please explain the procedure to pay dividend to shareholders.
CA Suraj Prasad Shaw (Chartered Accountant) (504 Points)
05 July 2011Experts please help.
Whether it is manadatory to pay dividend within 30 days from date of AGM?
What are the consequences if it is not paid during the above time period?
Please explain the procedure to pay dividend to shareholders.
Kunal
(Risk Analyst)
(299 Points)
Replied 05 July 2011
Kunal
(Risk Analyst)
(299 Points)
Replied 05 July 2011
CA Suraj Prasad Shaw
(Chartered Accountant)
(504 Points)
Replied 05 July 2011
| Originally posted by : roopak | ||
 |
yes it is mandatory to pay dividend within 30 days from its declaration... Within 5 days of declaration of dividend it shall be deposited in a seperate bank account....after depositing the same it can only be used for paying out dividend. Dividend once declared cannot be revoked xcpt under special cirumstances. Non payment of dividend within 30 days attracts penalty u/s 207. |
 |
Thanks...............
Dheeraj
(Learner)
(1100 Points)
Replied 05 July 2011
Agreed with ROOPAK
&
If company fails to comply with any of rules, the company and every officer of the company in default, shall be punishable with fine which may extend to five hundred rupees, and, where the contravention is a continuing one, with further fine which may extend to fifty rupees for every day, after the first, during which such contravention continues.
SkDash
(CS (Member) CWA (Final))
(909 Points)
Replied 05 July 2011
Roopak-ur two answers are contradictory. 1. Dividend amt to be deposited in a separet bank account within 5 days and 2. Dividend can be paid in cash.
How dividend payment by cash is possible ? Can a company simply withdraw cash and pay it to shareholders ?
whether bank can allow for withdrawal of cash simply on company's request ?
If the Co withdraws cash and didnot pay, then what will be the consequences ? If this is possible, what the purpose of opening a separte bank account ?
Kunal
(Risk Analyst)
(299 Points)
Replied 05 July 2011
Comment on “Excuse by Company for not having fund”
Boy, If company doesn’t have fund in its hand, then It will not declare dividend. Because declaration of dividend is not compulsory and Dividend amount is to be decided by the Board, who are aware of the Financials of the company.
So, No company across the Globe can use that excuse.
Kunal
(Risk Analyst)
(299 Points)
Replied 05 July 2011
Boy, In your example you forgot to add the condition that Directors of the company are having the Memory loss problem like Amir Khan in Ghajini and they forgot that they need to deposit dividend in 5 Days in separate bank account.
If you will add this condition then your case will be much more stronger. Capital Investment decisions are serious in nature, they are not decided over night. You are good at studying but not in practical terms.
periasamy
(DGM Finance)
(91 Points)
Replied 08 July 2011
If dividend is paid within 5 days directly to the shareholders either by DD or cash, the necessity of seperate account is necessary. Pls expers confirm.
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