Ad Free CAclubindia and Daily Updates on your Mobile. Subscribe Now!

Dividend

CA Prashak Kumar Goyal (Pratice) (192 Points)

06 June 2018

Example of Non Payment of dividend which Is not due to default of company.

Reply
Follow
Share

1 Replies

Siddharth Goel (Chartered Accountant) (3031 Points)
Replied 06 June 2018

Hi,

Following are the examples of Non payment of Dividend for which Company shall not be liable as per Section 127:

(a) Where the dividend could not be paid by reason of the operation of any law;

(b) Where a shareholder has given directions to the company regarding the payment of the dividend and those directions cannot be complied with and the same has been communicated to him;

(d) Where the dividend has been lawfully adjusted by the company against any sum due to it from the shareholder; or

(e) Where, for any other reason, the failure to pay the dividend or to post the warrant within the period under this section was not due to any default on the part of the company.