Dividend related

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rajni (Querist)
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11 September 2013 The amount of Dividend after deducting tax at source, if
applicable, should be deposited in a separate bank account
within five days from the date of declaration of Dividend. Do these 5 days also includes sundays?

Ajay Mishra

Ajay Mishra (Expert)
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11 September 2013 Hi

Section 205A state that the amount of dividend including interim dividend shall be deposited in a separate bank account within five days from the date of such declaration. Therefore, a company cannot use the amount even upto the period of thirty days and it is obligatory on the part of the company to keep the entire amount of the dividend into a separate bank account, which shall be exclusively utilised for payment of the dividend.

A company which has declared dividend must open an account in a scheduled bank and transfer the entire net amount of dividend to the above account within 5 days from the date of declaration and simultaneously should dispatch the dividend warrants to the shareholders and should not wait for 37 days to transfer the amount to that account.

After reading the provision of section, it does not says that public holiday will be excluded.

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