Can dividend be paid in hard cash/currency?? If we can keep cash receipt confirmation from the recipient, will this be legal?
3 Replies
CS Arjun Rajagopal
(B.com, ACS)
(1056 Points)
Replied 07 February 2014
Section 205(5)(b) of the Companies Act, 1956 provides that the dividend payable in cash may be paid either by cheque or warrant.
Regards,
ARJUN RAJAGOPAL
Still Learning
(cs)
(234 Points)
Replied 09 February 2014
And can share application money be paid in cash?? As per the old Act as well as the new Act?
CS Arjun Rajagopal
(B.com, ACS)
(1056 Points)
Replied 10 February 2014
It is not clear from your side. Any way ,as per Sec. 42 of the Companies Act, 2013(yet to be notified) companies will not be able to receive share application money in cash. An Escrow A/c should be opened by the company to receive share application money and utilise that money only for the purpose of allotment of shares.
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