UNPAID DIVEDEND ACCOUNT SECTION 124

Company had declared the dividend, but the declared dividend amount remains unclaimed and
unpaid.

(normally within 30 days from the date of declaration of the dividend it should be paid to the
registered shareholders)

The company within next 7 (after 30 days) days should deposit the unpaid dividend in the SPECIAL
ACCOUNT any schedule bank “unpaid dividend account”

The company should prepare a statement within 90 days and it should be placed in the normal
company website and the websites which is approved by central government.
The statement consists of the details of name, address, unpaid dividend amount of the share
holders.

If the company din’t pay the dividend payment after the declaration and within 30 days and it dint
transfer the unpaid dividend amount (declared) to the separate bank account then the company is
liable to pay 12% of interest PA

After the unpaid dividend amount has been transferred to the scheduled bank account

If the shareholder ask for the dividend payout to the company by applying, then the company will
pay the dividend money from the account.

After transfer of unpaid dividend amount to the separate account if the amount is not claimed or
distributed to the shareholder then the company will transfer the amount along with the interest to
the “investor education and protection fund”.

Even after transferring the amount to the “investor education and protection fund” if the share
holder ask for the dividend payout, then it can be paid from that account.
Company has to pay the dividend within 30days from the date of declaration of the dividend.

If fails then as per sec 127 company and director will be punished.

Company should pay 18% per annum in simple interest.

Dividend has been declared but payment has not been paid to the share holders due to operations
of law, then there is an exemption from the punishment from u/s 127 to the company as weel as to
the directors