No Debentures can not be redeemed out of capital only. Gov of India and SEBI has indirectly placed restrictions on redemption of debentures. Now it is compulsory to create Debenture Redemption Reserve at-least 50% of the debentures issued.
Whan compay purchase debenture from the open market
The redemption price of mutual fund units is the close of business NAV of the mutual fund minus the applicable exit load. Let us say you have 1000 units of a fund that is currently having an NAV of $15 and you have a 0% exit load situation you will be getting $15,000 if you redeem your investment.
To, The Manager __________ (Fill in the name of the Mutual Fund house in the blanks) From, _____ (Fill in your Name) ______(Fill in your Address & Phone number) _______(Fill in your folio number) Sir, Sub: Reg. Redemption of Mutual fund investment with folio number ______ (Fill in the folio number) I would like to redeem my mutual fund investment with the fund ______(Fill in the fund name) with folio number _____(fill in the folio number) as on today ____(fill in the date) Kindly process the redemption request and credit the money into my bank account whose details are below: Bank Name: _______ (Fill bank name) Acc Num: ________ (fill the Account number) Branch: _______ (fill in the bank branch name) Thank you ________ (Fill your name and sign) Alternately, the fund house may have a mutual fund redemption form which you can fill to service the redemption request.
To, The Manager ______________ From, ____________ ____________ ____________ Sir, Sub: Reg. Redemption of Mutual fund investment with folio number _________________ I would like to redeem my mutual fund investment with the fund _________________________________ with folio number _________________ as on today ________________ Kindly process the redemption request and credit the money into my bank account whose details are below: Bank Name: ________________ Acc Num: _________________ Branch: _________________ Thank you, __________________
The Capital Redemption Reserve is a fund that secures a creditor. Debenture Redemption Reserve is for the purpose of security payments only.
After redemption of debentures, debenture redemption reserve is to be transferred to general reserve.
Indian Companies Act of 1956 added during an amendment in the year 2000. It states Indian company that issues debentures must offer debenture redemption service to protect investors against the possibility of company default. If a company does not create a reserve within 12 months of issuing the debentures, they will be required to pay 2 percent interest in penalty to the debenture holders. Only debentures that were issued after the amendment in 2000 are subject to the debenture redemption service.
Redemption of Debenture was enacted into Indian law in 2000. It states that any Indian company with a debenture trust must also have a plan in place for its investors, in case of the company's failure.
Debenture is a debt instrument to raise funds. It has a maturity period associated with it. At the end of the maturity, the company(borrower) should return the interest and principal amount. Debenture Redemption Reserve is an amount kept as reserve for paying the debenture holder at the end of the maturity period.
It is capital loss of the company. It comes only in the time when redeem debenture. It is shown when we issue the debenture because it is one of the redeemable condition. it is loss of future but comes in balance sheet as separate account the name of premium redemption account in liability side so, it is carried at the time of issue.
No Debentures can not be redeemed out of capital only. Gov of India and SEBI has indirectly placed restrictions on redemption of debentures. Now it is compulsory to create Debenture Redemption Reserve at-least 50% of the debentures issued.
A company can buy its own debenture in the open market, if it is authorised by its AOA. the debentures so purchased can be used either for immediate cancellation or redemption of debenture or for investment. the debenture so purchase for investment can be subsequently either be issued to fullfill additional requirements of cash or can be cancelled if the company so desires. debentures when purchases for investment are popularly known as 'OWN DEBENTURES.'
Whan compay purchase debenture from the open market
A debenture invests fund in the company and is sure of its return eventhough the company fails through its corporate stock. An investor can only gain depending upon the market condition.
You need to submit a redemption request with the mutual fund house where you have mutual fund investments. The fund house would have given you a folio number when you initially invested the money with them. You need to fill that up in the redemption form. Once you submit your request (Usually a redemption form) the mutual fund house will process your request and will repay you the current value of your investment in 3-5 working days.
The redemption price of mutual fund units is the close of business NAV of the mutual fund minus the applicable exit load. Let us say you have 1000 units of a fund that is currently having an NAV of $15 and you have a 0% exit load situation you will be getting $15,000 if you redeem your investment.