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Declaration of dividend

(Guest)

Hi,

During the Sept 2011 to March 2012 unlisted public company has allotted equity shares. Now company is declaring dividend. Company wishes to declare dividend for the year 2011-2012 on pro-rata basis to the shareholders? Whether dividend is to be paid fully or for the period the new shares remain outstanding.

Is this allowable or company is under compulsion to make firm payment of dividend to all the shareholders irrespective of the holding period of shares.

Also appreciate we have received NOC from all the shareholders for the payment of dividend on pro-rata basis.

With Regards

Neha Jain

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3 Replies

CS Ankur Srivastava (Company Secretary & Compliance Officer) (17848 Points)
Replied 31 July 2012

Dividend is to be paid on the number of shares as on the date of Book Closure. Dividend is different from the interest, it is the distribution of profit. You should pay dividend to the entire shareholding irrespective of the period of issue.

In case of dividend time period is irrelevant.

(Guest)

Originally posted by : CS Ankur Srivastava
	Dividend is to be paid on the number of shares as on the date of Book Closure. Dividend is different from the interest, it is the distribution of profit. You should pay dividend to the entire shareholding irrespective of the period of issue. In case of dividend time period is irrelevant.

Ankur Jee,

Yes, even i appreciate that dividend is not paid on the basis of period of issue.

But my query pertains to the point that :

We wish to pay pro-rata dividend on the basis of period of holding during the year and all our shareholders are agreeing to the same.

We have obtained NOC from all our shareholders regarding payment of pro-rata dividend. So are there any hassles ? Can we go ahead and pay on pro-rata basis?

Await your opinion in this regard...!