Interest on late payment of dividend
This query is : Resolved
pratik upadhyay
(Querist)
24 November 2016
Dear All, I refer Paduka Corp Law book For CA Final (May 2016 edition.) As I was reading Dividend Chapter , I observed that interest on late payment of dividend is 18%, however end the end of the chapter there's a section with title "Companies Act 1956 provisions still relevant". In this section the interest rate is 12%. I wish to know what % will be payable for delay in late payment of dividend for FY 2015-16 and FY 2016-17.
CA SAGAR M. AHUJA
(Expert)
24 November 2016
In simple words both interest rate are for different purpose read below,
The 18% Interest rate is applicable where a dividend has been declared by company but not been paid (Section 127 of companies act, 2013)
The 12% Interest rate is applicable Where the default is made in transferring the unpaid or unclaimed amount of dividend to the unpaid dividend account of company. (Section 205A of companies act, 1956)
Hope your doubt clear.
Thanks.
The 18% Interest rate is applicable where a dividend has been declared by company but not been paid (Section 127 of companies act, 2013)
The 12% Interest rate is applicable Where the default is made in transferring the unpaid or unclaimed amount of dividend to the unpaid dividend account of company. (Section 205A of companies act, 1956)
Hope your doubt clear.
Thanks.
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24 November 2016
@ Sagar Ji
Corresponding section to 205A in 2013 act is 124(3) enforced from 7.9.2016.
Corresponding section to 205A in 2013 act is 124(3) enforced from 7.9.2016.
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pratik upadhyay
(Querist)
24 November 2016
Thanks for replying sir
CA SAGAR M. AHUJA
(Expert)
24 November 2016
Ok, Thanks for updating me
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