Dividend-II

		Article-71
Second Article  in the series Dividend- Provisions
1.	Dividend can be paid out of profits of the current year or of the previous years after charging depreciation.
2.	If depreciation has not been provided in any financial year, it will have to be provided out of the accumulated profits/ profits before declaring dividend.
3.	Central Government has the power to allow any Company to declare dividend without providing for depreciation in public interest.
4.	A loss incurred in any previous year shall be set off and made good from the accumulated profits/current profits.
5.	Such a set off has a limitation. In such case the amount set off shall be lesser of: 1.   The full amount of loss, and 2.   The amount equal to the depreciation for the concerned year.
6.	Only General Meeting can declare final dividend.
7.	Board of Directors can declare interim dividend.
8.	The amount of dividend shall be deposited in a separate bank account within five days of the declaration of dividend, whether interim or final.
9.	Dividend can be paid in cash only. Payment by cheque or dividend warrant amounts to payment in cash.
10.	A fixed percentage of current profit shall be transferred to reserves.
11.	If dividend declared, is less than 10%, no need to transfer to reserves.
12.	The members cannot declare a dividend, which is higher than what the Board recommended.
13.	The liquidators cannot declare or distribute dividend.
14.	It is possible to declare dividend out of accumulated profits due to inadequacy or absence profits in the current year, subjected to the rules framed by Central Government.
15.	Declaration of dividend a second time out of profits of past years is not allowed.
16.	Once the dividend is declared in a General Meeting, the Company or the Board cannot declare further dividend for the same year.
17.	Dividend must be paid within 30 days from the date of declaration.
18.	Unpaid or unclaimed dividend shall be transferred to unpaid dividend account of the Company within thirty-seven (30+7) days from the date of declaration of dividend.
19.	Thereafter dividend shall be paid out of this account for that particular year.
20.	The entire unclaimed dividend in that account after seven years will have to be transferred to “Investor Education and protection fund”.
Minimum percentage of profits to be transferred to Reserves
proposed percentage of dividend				Minimum percentage to be transferred.
10 .0% to 12.5% of paid up capital			:	2.5%
12.5 % to 15.0 %of paid up capital			:	5%
15 .0% to 20.0% of paid up capital			:	7.5%
20.0% and above of paid up capital			:	10%