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CS Executive · Company Law and Practice · Distribution of Profits

Bharat Components Ltd declared a dividend at its AGM. The Company Secretary notes the dividend amount must be deposited in a separate account in a scheduled bank. Within what time from the date of declaration must this be done under the Companies Act, 2013?

The dividend amount, including interim dividend, must be deposited in a separate account in a scheduled bank within five days from the date of its declaration, as required by Section 123(4) of the Companies Act, 2013.

  1. AWithin five daysCorrect
  2. BWithin fifteen days
  3. CWithin thirty days
  4. DWithin seven days

Explanation

Section 123(4) requires the dividend amount, including interim dividend, to be deposited in a scheduled bank in a separate account within five days from the date of declaration. The other periods are not provided in that sub-section.

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