Regulation of dividends on preference shares in certain cases.
3. (1) Where the stipulated dividend in respect of a preference share of a company issued and subscribed for before the 1st April, 1960,-
| (a) | - | is specified to be free of income-tax and no deduction is made therefrom on account of the income-tax payable by the company, or |
| (b) | - | was being paid before the 1st April, 1960, without any deduction therefrom on account of the income-tax payable by the company, notwithstanding the absence of any specification that the dividend would be free of income-tax, |
every such share shall, as respects dividends declared after the commencement of this Act, carry a preferential right to be paid without any deduction aforesaid such amount as would exceed the stipulated dividend by thirty per cent thereof.
(2) Where the stipulated dividend in respect of preference share of a company issued and subscribed for after the 31st March, 1959, and before the 1st of April, 1960, is free of income-tax, and the company, besides paying the stipulated dividend to the holder of such share, pays to Government on his behalf any sum on account of income-tax payable thereon, then, every such share shall, as respects dividends declared after the commencement of this Act, carry a preferential
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