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CA Intermediate · Corporate and Other Laws · Declaration and Payment of Dividend

Sundaram Textiles Ltd declared a final dividend for FY 2025-26 at its annual general meeting held on 10 September 2026. The board has not yet paid it. Under the Companies Act, 2013, within how many days of the declaration must the company pay the dividend to the shareholders entitled to it?

A company must pay a declared dividend to entitled shareholders within thirty days of the date of declaration. If it fails, the amount becomes subject to default consequences including interest. Other periods such as fifteen, forty-five or sixty days are not the statutory period for dividend payment.

  1. A15 days
  2. B30 daysCorrect
  3. C45 days
  4. D60 days

Explanation

The Act requires the company to pay the declared dividend within 30 days from the date of declaration. 15 days applies to other matters and 45 or 60 days has no application to dividend payment. Hence 30 days is the correct period.

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