Debenture Remove Currency For Free

The interest on debentures is a charge to the profit of the company.The company collects this tax and later deposit it to the income tax authorities. The debenture holders can assign the TDS amount against the tax that is due from them.

Debentures generally have a more specific purpose than other bonds. While both are used to raise capital, debentures typically are issued to raise capital to meet the expenses of an upcoming project or to pay for a planned expansion in business.

Why debentures are safer investments compared to stocks Debentures are considered safer investment vehicles compared to stocks because their value cannot be as easily manipulated as that of stocks. More often then not, the companies which issue debentures are massive companies with a substantial reputation.

Debentures are debt instruments. Hence when their period expires, debenture holders are paid back their principal amount. This process of discharging the company's debt is known as the redemption of debentures.

Generally, a company redeem its debentures by purchasing in the open market when the interest rate of debentures is higher than the market interest rate. Under this method, debentureholders are given the right to exercise the option to convert their debentures into shares or new class of debentures.

The debenture can typically only be converted into stock after a predetermined time, as specified in the bond's offering. A convertible debenture will usually return a lower interest rate since the debt holder has the option to convert the loan to stock, which is to the investors' benefit.

What is a Debenture? A debenture is a bond issued with no collateral. Instead, investors rely upon the general creditworthiness and reputation of the issuing entity to obtain a return of their investment plus interest income.Examples of debentures are Treasury bonds and Treasury bills.

Any transfer of the Debentures shall be made by a deed of transfer drawn up in the accepted form, duly signed by the registered holder or his legal representatives and by the transferee or his legal representatives, which shall be delivered to the Company at its registered office together with the certificates of the

A debenture is converted into equity shares. A notice of the conversion is sent, and the debenture holders are asked to return debenture certificates. Secretary carries out the process of allotment of the shares. After allotment, changes have to be made in the Register of charges.

Conclusion. The provisions of the Companies Act, 2013 authorizes for the process of Conversion of Debentures into Shares. Further, the main reason as to why a company chooses this type of conversion is the economic benefit to the shareholders.