Do you want to declare the ultimate dividend?
Convene a board assembly after giving discover to all the administrators of the corporate as per part 173 of the 2013 act and let your board of administrators contemplate the quantity of dividend to be really helpful to the making certain annual common assembly for declaration.
Beware that each officer of the corporate whose obligation is to present discover of the board assembly as aforesaid and who fails to take action shall be punishable with high-quality of Rs.25, 000. This offense is compoundable by the regional director of any officer licensed by the central authorities.
It’s pertinent to notice that an organization which fails to adjust to the necessities of part 73 and 74 of the 2013 act in relation to acceptance and repayments of public deposits is restrained from declaring any dividend on its fairness shares as long as the failure continues beneath the above sections.
If your organization’s shares are listed then do the next:
Give discover to inventory exchanges upfront of a minimum of 7 working days beginning the date of closure of your organization’s switch books for objective of declaration of dividend.
Notify to the acknowledged inventory change a minimum of 2 working days upfront the date of the board assembly at which the advice of a dividend is because of be thought-about.
Declare and disclose the dividend on per share foundation solely.
Earlier than the declaration of dividend for any yr, an organization ought to switch such proportion of its earnings for that monetary yr as is taken into account as applicable to the reserves of the corporate. Within the 2013 act, the share of earnings that must be transferred to the reserves earlier than the declaration has been left to the discretion of the corporate.
Forthwith inform the next to the acknowledged inventory change with which the shares of your organization are listed after the holding of the board assembly:
All dividends really helpful or declared;
The full turnover, gross revenue or loss, provision for depreciation, tax provision and internet revenue for the yr and the quantity appropriated from reserves, capital earnings, amassed earnings of previous years or different particular supply to supply partly or wholly for the dividend even when this requires qualification that such info is provisional or topic to audit.
Embrace within the agenda of the annual common assembly, the enterprise of declaration of dividend.
Go an odd decision by a easy majority within the annual common assembly, declaring the dividend.
Open a separate checking account with a scheduled financial institution and credit score the quantity inside 5 days from the date of declaration.
The dividend can’t be paid by an organization in respect of any share therein besides to the registered holder of such share or to his order or to his banker and wouldn’t be payable besides in money.
The cost by digital mode or cheque or warrant to the shareholder entitled to the cost of the dividend shall be construed as cost in money.
Repair and notify the recognised inventory change with which the shares of your organization are listed a minimum of twenty one days upfront of the date on and from which the dividend shall be payable and concern concurrently the warrants which shall be encashable at par in any respect the branches of your organization’s bankers in order to succeed in the shareholders on or earlier than the date fastened for cost.
Prepare to make cost inside thirty days of declaration both in money or by cheque warrant despatched via the put up directed on the registered deal with of the shareholders entitled to the cost of the dividend.
The place devices of switch have been obtained by the corporate in relation to some shares and the switch of such shares has not been registered when the dividend warrants have been posted. Maintain that quantity of dividend additionally within the particular quantity known as “unpaid account” except the corporate is permitted by the registered holders of these shares in writing to pay the dividend to the transferees specified within the mentioned devices of switch.
Prepare to switch the full quantity of dividend, which stays unpaid or unclaimed inside seven days from the date of expiry of thirty days from the date of its declaration to a particular account to be opened by your organization on this behalf in any scheduled financial institution to be known as “unpaid dividend account of firm ltd”.
See that the unpaid dividend contains the quantity of dividend the warrants in respect of which have both not been encashed or which have in any other case not been paid or claimed.
If your organization is a authorities firm then don’t switch the unpaid dividends to the particular account.
Observe that if an organization which has declared, nevertheless it has not paid or the warrant in respect thereof has not been posted inside thirty days from the date of declaration to any shareholder, then each director of the corporate who’s knowingly a celebration to the default shall be punishable with easy imprisonment for a time period of two years and also will be liable to a high-quality of Rs.1000 for daily throughout which such default continues and the corporate could also be liable to pay easy curiosity on the fee of 18% every year throughout a interval for which such default continues.
Additional observe that no offense as acknowledged within the previous paragraph shall be deemed to have been dedicated by your organization’s administrators within the following instances:
The dividend can’t be paid by purpose of the operation of any regulation;
The shareholder has given a course to the corporate which regards the cost of the dividend and people instructions is not going to be complied with and the identical may be communicated to him;
The place there’s a dispute concerning the best to obtain the dividend;
The place the dividend has been lawfully adjusted by the corporate towards any sum on account