(i) Company cannot issue irredeemable preference shares or redeemable preference shares with the redemption period beyond 20 years.
except (In case of infrastructure co.)
(ii) Issue of preference share must be authorized by AOA & passing SR in GM.
(iii) Only fully paid up preference shares can be redeemed.
(iv) Preference Shares shall be redeemed out of the -
Note - where such shares are proposed to be redeemed out of the profits of the company, there shall, out of such profits, be transferred, a sum equal to the nominal amount of the shares to be redeemed, to a reserve, to be called the Capital Redemption Reserve Account (CRR A/c).
(v) The company, at the time of such issue of preference shares, has no subsisting default in the redemption of preference shares issued earlier or in payment of dividend due on any preference shares.
(vi) A company may redeem its preference shares only on the terms on which they were issued.
(vii) Redemption can be done at -
(vii) If a company is not in a position to redeem any preference shares or to pay dividend then -
(viii) When a company issues preference shares, the Register of Members maintained under section 88 shall contain the particulars in respect of such preference share holder's.