Dividend payment to OBC

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Meenakshi (Querist)

02 July 2009 Dear All,

Please solve my following query:

My company is Indian public ltd company (unlisted). One shareholder (8% equity shareholding) is foreign company of Germany. Please tell me how we can pay dividend to that German Company (state the procderue which an Indian company has to follow) and if existing Indian shareholder cum director wants to buy his all shares so what will be the procedure?

Its urgent. Thanks in advance.

Meenakshi.

CA. B.SRINIVASULU

CA. B.SRINIVASULU (Expert)

03 July 2009 For payment of dividend :

Step 1 : Read the DTAA with germany

Step 2 ; Withold tax as per that DTAA

Step 3 : Get a Certificate from CA in Form 15CB

Step 4 : Long on to nsdl fill Form 15Ca and generate the approval number.

Step 5 ; Submit to bankers along with Form A2 under Fema for payment

Step 6 : Pay the dividned tax

For purchase of shares :

Step 1 : Find out the present value of share

Step 2 : If the purchase value is less than 1,00,000 dollars you can purchase through authroised dealer and can make payament to him. Form A2 under FeMa has to be submitted.

Step 3 : If purchase value is more thatn 1,00,000 dollars then you have to get rbi permission.

Meenakshi

Meenakshi (Querist)

03 July 2009 Thank u very much Sir for your reply.

Regarding above query:
German co.(Shareholder) Invested amountin Indian company (Unlisted) through foreign direct investment scheme through Automatic route on repatriation basis. So Now please guide me in this condition Indian company has to follow procedure as above you told me or anything else.

I need your help,I havent foggiest idea about it.

Thanks in advance.

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