XP Ltd declared 12 dividend to its Equity Shareholders However Company missed to transfer unpaid nbs...........

Companies Act-Phase (I & II) Paymentofdividends

XP Ltd declared 12% dividend to its Equity Shareholders. However, Company missed to transfer unpaid dividend to bank account even after 40 days from declaration of Dividend. In such case how much interest will be payable?

8% p.a.

16% p.a.

10% p.a.

12% p.a.

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Explanation:

Pursuant to section 124(3) of the Act earlier section 205A (4) of CA, 1956, company shall pay an interest at the rate of 12% per annum on the unpaid/unclaimed dividend amount from the date of such default. The interest accruing shall ensure to the benefit of the members in proportion to the amount remaining unpaid to them. Additionally the company may also be liable for penal provisions as mentioned under section 124 (7)