Central

Section 1 of The Preference Shares (Regulation of Dividends) Act, 1960

This Act may be called the Preference Shares (Regulation of Dividends) Act, 1960.

(2)It extends to the whole of India: Provided that it shall not apply to the State of Jammu and Kashmir* except to the extend to which the provision of this Act relate to the regulation of dividends on preference shares of banking and insurance companies and financial corporations. 1[(3) Notwithstanding anything contained in sub-section (2) the provision of this Act shall, in their application to the Union territory of Pondicherry, have effect subject to the modifications specified in the Schedule.]

Summary

This law is officially named the Preference Shares (Regulation of Dividends) Act, 1960.
The rules set out in this law apply to the entire country of India.
For the State of Jammu and Kashmir, the law has a limited scope and only applies to dividends on preference shares of banking companies, insurance companies, and financial corporations.
For the Union territory of Pondicherry, the law is applied with specific changes that are detailed in the Schedule of the Act.

Practical examples

1Ramesh lives in Delhi and owns preference shares in a manufacturing company. Since Delhi is a part of India and not Jammu and Kashmir, the standard rules of this Act apply to his dividends.

2Sunita lives in Srinagar, which is in Jammu and Kashmir, and she owns preference shares in a local banking company. Because her shares are in a banking company, the Act applies to her preference shares even though they are located in Jammu and Kashmir.

FAQ

1. What is the official name of this law?

The official name of this law is the Preference Shares (Regulation of Dividends) Act, 1960.

2. Does this law apply to the entire country of India?

Yes, it extends to the whole of India, but there are special rules for Jammu and Kashmir and the Union territory of Pondicherry.

3. How does this law apply to Jammu and Kashmir?

It does not apply to Jammu and Kashmir except for regulating dividends on preference shares of banking and insurance companies and financial corporations.

4. Is there any special rule for the Union territory of Pondicherry?

Yes, the law applies to Pondicherry subject to the modifications, which means changes, specified in the Schedule.

Test yourself

Q1.What is the official name of this Act?

Q2.To which territory does this Act extend?

Q3.For Jammu and Kashmir, to which types of companies does this Act apply under Section 1?

Q4.Where are the changes for the Union territory of Pondicherry listed under Section 1?

Q5.Under Section 1, what does the term modifications mean?

2NextSection 2 Definitions.

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