Conditions of revocation of declared dividend

FCS Deepak Pratap Singh | Last updated: 07 January 2023

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A dividend declared by a company generally becomes a debt owed to shareholders and cannot be revoked without their consent. However, certain exceptional circumstances, such as illegal declarations, unforeseen events like war or natural disasters, or significant financial distress, may allow for revocation before payment. The distinction between final and interim dividends is crucial, as interim dividends offer more flexibility for cancellation by directors before they are paid.

As you are aware that Dividend is a return on investment made by shareholders in a Capital of a Company and it is different from return on borrowed Capital as interest. A dividend is share of profit to the shareholders of a company ,in which he/she /it has invested. The SS-3 Defines Dividend as D

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About the Author

FCS Deepak Pratap Singh

Associate Vice President - Secretarial & Compliance (SBI General Insurance Co. Ltd.)

Dear Friends, MyselfFCSDeepak P. Singh ( B.Sc.. LLB, FCS. FIII, CIAFP, CRMP, ID) , A Fellow Member of ICSI, Law Graduate ,Fellow Member of Insurance Institute of India, Certified Independent Director ,Certified Insurance Anti Fraud Professional , Certified Risk Governance Professional ( ICSI-III) and cleared Limited I ... Read more

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