Debenture redemption reserve
This query is : Resolved
SREENATH P.
(Querist)
15 September 2016
Sir/madam,
I have a doubt on creation of Debenture redemption reserve.
For the NBFCs, Companies share capital and debenture rule says that adequacy of DRR will be 25% of the value of debentures issued through public issue.
My question is whether the term issued means outstanding debenture plus redeemed debenture?or the requirement is only for outstanding debenture?
Thanks in advance
I have a doubt on creation of Debenture redemption reserve.
For the NBFCs, Companies share capital and debenture rule says that adequacy of DRR will be 25% of the value of debentures issued through public issue.
My question is whether the term issued means outstanding debenture plus redeemed debenture?or the requirement is only for outstanding debenture?
Thanks in advance
CA R SEETHARAMAN
(Expert)
15 September 2016
The requirement is only for outstanding debentures.
SREENATH P.
(Querist)
17 September 2016
Thank you
Is it enough to create DRR in a financial year for the amount will be redeemed in the follwing financial year?because some of the NBFCs following DRR Creation like this.Since there is no specific guideline by RBI on this,is it viable under Companies Act?
Is it enough to create DRR in a financial year for the amount will be redeemed in the follwing financial year?because some of the NBFCs following DRR Creation like this.Since there is no specific guideline by RBI on this,is it viable under Companies Act?
CA R SEETHARAMAN
(Expert)
17 September 2016
Reserve has to be created yearly.
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