1. Voting Rights: Section 47, CA, 2013 provides that each equity shareholder of a corporation has the proper to vote on every resolution placed before the corporate . Equity shareholder’s voting right on a poll will be in proportion to his share in the paid-up equity share capital of a company.
Every preference shareholder of a corporation will have a right to vote only on resolutions placed before the corporate directly affecting his rights attached to the preferred stock and any resolution for completing of the corporate or for repayment or reduction of its equity or preference share capital. Voting rights of each preference shareholder on a poll shall be in proportion to his share within the paid-up preference share capital of the corporate .
2. Dividend: Every equity shareholder has the proper to receive dividend declared by directors of the corporate yearly also as interim dividend if declared by the administrators in accordance with s. 143 of the CA, 2013. Every preference shareholder has the proper to receive preferred dividend as per the terms of issue of preferred stock .
3. Right to uniform calls on shares: Where any calls are made by the company for a class of shares from uncalled capital of the company, such calls should be made uniformly for all shares of that class.
4. Right to be paid at completing of the corporate : Every preference shareholder has the well-liked right of payment at the completing of the company or repayment of capital. They may even have the proper to participate in surplus capital if they’re participating type. Equity shareholders even have the proper of payment from the capital of the corporate left after repaying creditors and preference shareholders of the corporate at the completing of the company.
5. Variation of shareholder’ rights: S. 48, CA, 2013 restricts the variation of shareholders’ rights except with the consent in writing of the holders of not less than three-fourths of the issued shares of the class of shares whose rights are being modified. Such a variation can also be made by means of a special resolution passed at a separate meeting of shareholders of that class if provision in respect of such variation is contained in memorandum or articles of the company or in its absence such variation is not prohibited by terms of issue of shares of that class.
If variation by one class of shareholders affects the rights of the other class of shareholders, consent of three-fourths of such other class of shareholders shall even be obtained.
6. Right of participation in Annual General Meeting: Shareholders have the proper to receive notice for attending the AGM of the corporate . Each shareholder has the right to receive financial statements, including auditors’ report and other documents annexed to financial statements, along with directors’ report presented by Board of directors at AGM.
7. Right to transfer shares/securities or other interest in company: Securities or other interest of any member in a public company are freely transferable under Sec 44, CA, 2013. Shareholders of a public company have freely transferable shares/ securities with none restriction on transferability of shares.
8. Rights Issue: Every equity shareholder of a corporation features a right to be offered shares when the corporate goes for further issue of capital. Such right falls under pre-emptive rights of existing shareholders of any company having a share capital and is protected by S. 62 of the Companies Act, 2013.
Source of Division
Brief They main source for raising funds, and they signify ownership in the company. The shares which guarantee shareholders fix the rate of dividend, and they are a lender of capital and not an owner.
Dividend Rate Equity shareholders received a dividend at a Fluctuating rate and paid after all liabilities payment. Preference shareholders received dividend payments at a hard and fast rate and before Equity Shareholders.
Capital Payment/Liquidation within the case of company insolvency Equity shareholders payment settled or repaid at the top . In the case of company insolvency Preference shareholders payment is repaid before the equity shareholders.
Voting Authority Equity shareholders have the proper to vote on all matters of the corporate . Generally, do not carry the voting rights but in some cases, they get the voting rights.
Convertibility Equity shares cannot be converted. Some sorts of preference share are often converted to Equity shares.
I have always been against Glorifying Over Work and therefore, in the year 2021, I have decided to launch this campaign “Balancing Life”and talk about this wrong practice, that we have been following since last few years. I will be talking to and interviewing around 1 lakh people in the coming 2021 and publish their interview regarding their opinion on glamourising Over Work.
If you are interested in participating in the same, do let me know.
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