Can Dividend be paid out of capital:
No, dividend cannot be paid out of capital
Correct AnswerYes, it can be paid out of capital
Incorrect AnswerYes, it can be paid out of capital only if authorised by AOA of the company
Incorrect AnswerYes, it can be paid out of capital only if authorised by MOA of the company
Incorrect AnswerExplanation:
According to Section 123(1) of Companies Act, 2013 dividend can not be paid out of capital. It can be paid out of current year's profit or out of profits of any previous financial year (s) or out of money provided by Central or State Government for the payment of dividend.
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By: Vikas Goyal