Bonus share issuance requires board recommendation and shareholder approval and prohibits using revaluation reserves. A company may issue fully paid-up bonus shares by capitalising free reserves, the securities premium account or the capital redemption reserve account, but not reserves from asset revaluation. Such issuance requires authorisation in the articles, a Board recommendation and shareholder approval; the company must not be in default on deposit or debt obligations, must be current on specified employee statutory dues, must make partly paid shares fully paid-up, and must satisfy prescribed conditions.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Bonus share issuance requires board recommendation and shareholder approval and prohibits using revaluation reserves.
A company may issue fully paid-up bonus shares by capitalising free reserves, the securities premium account or the capital redemption reserve account, but not reserves from asset revaluation. Such issuance requires authorisation in the articles, a Board recommendation and shareholder approval; the company must not be in default on deposit or debt obligations, must be current on specified employee statutory dues, must make partly paid shares fully paid-up, and must satisfy prescribed conditions.
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