Can a Section 25 Limited company issue preference shares?
3 Replies
Jayesh
(.)
(38 Points)
Replied 30 August 2011
Sec. 25 Company is prohibited to distribute dividend and preference shares always carry some fixed rate of dividend
RISHI
(cs)
(227 Points)
Replied 30 August 2011
Is it not possible to issue Pref. shares without dividend payment ? I mean to say whether Companies Act prohibits to issue Pref shares without dividend?
Jayesh
(.)
(38 Points)
Replied 30 August 2011
| Originally posted by : RISHI | ||
 |
Is it not possible to issue Pref. shares without dividend payment ? I mean to say whether Companies Act prohibits to issue Pref shares without dividend? |
 |
yes !
As per Sec. 85, Is it not possible to issue Pref. shares without dividend right with fixed amount or fixed percentage
and
now don’t say Fixed amount or fixed percentage can be Zero
Otherwise intention of law behind the Sec.85 will become meaningless and will amount to infringement of Sec. 85
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