'Equity share' means a share which is not preference share (s.85).
The rate of dividend is not fixed. The Board of Directors recommend the rate of
dividend which is then declared by the members at the Annual General Meeting. Before
recommending dividend on equity shares, the Board of Directors have to comply
with the provisions of law as regards depreciation, transfer of a minimum amount
to reserves, etc.
The holders of equity shares have voting rights in
proportion to the paid-up equity capital of the company [s.87(1)].
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