(1) A company may issue fully paid-up bonus shares to its members, in any manner whatsoever, out of–<\/p>\n\n\n\n
(i) its free reserves;<\/p>\n\n\n\n
(ii) the securities premium account; or<\/p>\n\n\n\n
(iii) the capital redemption reserve account:<\/p>\n\n\n\n
Provided that no issue of bonus shares shall be made by capitalising reserves created by the revaluation of assets.<\/p>\n\n\n\n
(2) No company shall capitalise its profits or reserves for the purpose of issuing fully paid-up bonus shares under sub-section (1), unless–<\/p>\n\n\n\n
(a) it is authorised by its articles;<\/p>\n\n\n\n
(b) it has, on the recommendation of the Board, been authorised in the general meeting of the company;<\/p>\n\n\n\n
(c) it has not defaulted in payment of interest or principal in respect of fixed deposits or debt securities issued by it;<\/p>\n\n\n\n
(d) it has not defaulted in respect of the payment of statutory dues of the employees, such as, contribution to provident fund, gratuity and bonus;<\/p>\n\n\n\n
(e) the partly paid-up shares, if any outstanding on the date of allotment, are made fully paid-up;<\/p>\n\n\n\n
(f) it complies with such conditions as may be prescribed.<\/p>\n\n\n\n
(3) The bonus shares shall not be issued in lieu of dividend.<\/p>\n","protected":false},"excerpt":{"rendered":"
(1) A company may issue fully paid-up bonus shares to its members, in any manner whatsoever, out of– (i) its free reserves; (ii) the securities premium account; or (iii) the capital redemption reserve account: Provided that no issue of bonus shares shall be made by capitalising reserves created by the revaluation of assets. (2) No […]<\/p>\n","protected":false},"author":4,"featured_media":79763,"parent":79755,"menu_order":0,"template":"","format":"standard","meta":[],"categories":[11445],"tags":[1007],"acf":{"service_id":"215"},"yoast_head":"\n