dividend from reserves

Neha Amol Limaye (Company Secretary) (52 Points)

11 March 2008

A query- Can a private limited company give dividend out of General Reserve?

Reply
Follow
Share

1 Replies

Anil (1638 Points)
Replied 11 March 2008

U/s 205A(3) of Companies Act, a company (whether public or pvt. ) can declare dividends out of past profits kept in reserves only if either:

1) it complies with Companies(Declaration of dividend out of Reserves) Rules,1975 or

2)when the above rules are not complied with, with the previous approval of the Central Govt.