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CMA Final · Corporate and Economic Laws · Dividends

Dividend declared by Kaveri Textiles Ltd. has not been paid, nor the warrant posted, to a shareholder within the statutory period from the date of declaration. What is that period under Section 127?

The period is thirty days from the date of declaration. If dividend is neither paid nor the warrant posted to an entitled shareholder within thirty days, Section 127 applies and directors knowingly party to the default can be punished, subject to the listed exceptions.

  1. ASeven days
  2. BFifteen days
  3. CThirty daysCorrect
  4. DSixty days

Explanation

Section 127 applies where the dividend has not been paid or the warrant posted within thirty days from the date of declaration. Seven, fifteen and sixty days are not the period stated in the section.

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