explain Debenture certificate (1page answer)
Answers
Explanation:
(1) Debenture certificate is the certificate given to the debenture holder. It certifies that the holder is the creditor of the company to the limit of the number of debentures. (2) The company has to issue debenture certificate within 6 months of allotment of debentures.
Debenture Certificates are issued under the common seal of the company. The debenture certificate is a document, which certifies that the holder is the creditor of the company to the limit of a number of debentures multiplied by the face value of each debenture. For eg: if the certificate states 100 debentures of Rs. 100/- each, then holder having the certificate is entitled to get Rs. 10,000/- from the company at the time of redemption of such debentures by the company.
Thus, with the help of this certificate the holder get the repayment of principal sum at the fixed date and the payment of interest at the fixed rate.
Time of issuing a certificate: The certificate is to be issued to the holder within three months of the allotment of debentures or debenture stock and within two months after the application for the registration of the transfer of any such debenture or debentures stock. The certificate is to be delivered in accordance with the procedure laid in section 53 of the companies Act, 1956.