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Definitions
Additions:
Inclusions of 11 more terms, out of which the
important ones alongwith their implications are:
1.1
Dividend : the scope of Dividend has been enlarged,
by including interim Dividend-
The
earlier Section 205 did not provide for the payment
of interim dividend. It could be declared by the
Board of Directors in their meeting and withdrawn
subsequently. It was never a debt against the
Company.
But
now the new sub-section (1A) to 205 provides that
the Board of Directors may declare interim dividend
and that the Company should deposit the dividend
including interim dividend within 5 days from
such declaration in a separate Bank Account.(
This stipulation of depositing the dividend declared
was not there earlier.) And by virtue of sub-section
(1C) an interim dividend is in no way different
from the final dividend.( Except for authority
of declaration)
Section
205A: The dividend has to be paid within 30 days
from the date of declaration.( The earlier period
of 42 days has now been reduced to 30 days)
[Computation
of distributable Profits for interim dividend
shall be like that of final dividend]
Sec-207-
Every Director who is knowingly a party to the
default in distribution of dividend within 30
days shall be liable to imprisonment for a period
of three years and monetary penalty to Rs.1000
per day so long as the default continues. Simple
interest of 18% p. a. is payable where the default
in payment of dividend continues.
The
Share Capital shall now be of two types:
(a)
Equity Share Capital-
-
with
voting rights
-
with
differential rights as to dividend, voting
or otherwise in accordance with such rules
and subject to such conditions as may be prescribed.
(b)
Preference Share Capital
In
order to understand the implication of this amendment,
rules and regulations which will be prescribed
by the Central Government in this regard have
to be seen.
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