Question

Attempt the following 

What are the legal provisions regarding declaration of
dividend? 

Answer 1

1. Regulation 85 of Table A provides that the company may declare dividend in its general meeting.
2. The rate of dividend shall not exceed the rate recommended by the Board of Directors.
3. When the company fails to redeem redeemable preference shares within the specified period, company shall not declare any dividend on its equity shares, so long as such failure continues.
4. The company cannot declare dividends for past years in respect of which accounts are closed at previous annual general meeting.
5. The company cannot declare further dividend after declaration of dividend at Annual General Meeting.
6. The dividend once declared cannot be revoked (cancelled).