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Question
State True/False with reasons:
Redeemable debentures are repaid on winding up of the company.
State True/False with reasons:
Redeemable debentures are repaid on winding up of the company.
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Solution
The correct option is B False
(i) Redeemable debentures are those on which the total amount i.e., interest and principal due will be paid back after specified period. i.e.,
(ii) These debentures are redeemed after a specified period.
(iii) The period on which debenture is redeemed is fixed at the time of issue.
(iv) Equity shares are repaid on winding up of the company and not the redeemable debentures.
(v) Company has to redeem the debentures as per the terms and conditions of the issue.
(vi) If the company fails to redeem the debentures on the date of maturity, the tribunal may direct the company to redeem it or the person disobeying may be fined.
(vii) So redeemable debentures are repaid on maturity and not on the winding up of the company.
(i) Redeemable debentures are those on which the total amount i.e., interest and principal due will be paid back after specified period. i.e.,
(ii) These debentures are redeemed after a specified period.
(iii) The period on which debenture is redeemed is fixed at the time of issue.
(iv) Equity shares are repaid on winding up of the company and not the redeemable debentures.
(v) Company has to redeem the debentures as per the terms and conditions of the issue.
(vi) If the company fails to redeem the debentures on the date of maturity, the tribunal may direct the company to redeem it or the person disobeying may be fined.
(vii) So redeemable debentures are repaid on maturity and not on the winding up of the company.
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