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Dividend out of past reserves

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(Querist)
19 October 2010 As per provisions in the companies act, it is specifically mentioned that if a company incurs loss during the year, it can still declare dividend out of past reserves provided it fulfills all the 3 conditions.

1 condition out of that is - Max dividend which a company can declare in case of loss is - Average Rate of last 5 years dividend paid or 10% of paid up capital, whichever is less

Then how come a listed company like Indiabulls Securities (Auditor - Deloitte) declared 100% dividend for FY09 even though it reported net loss for that year.

Could some expert please enlighten me with the rules for distributing dividend in case of loss.
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CA Shiv

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CA Shiv (Expert)
19 October 2010 I think there was a profit 6121 lacs for 31.03.2010
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Rajat

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Rajat (Querist)
19 October 2010 Sir, I am referring to financial year 2008-09. In FY09 company reported Net loss of Rs 12.88 cr (Loss before tax of Rs 19.68 cr). Despite this it distributed 100% dividend.
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