Question

Select the most appropriate answer from the alternatives given below and rewrite the sentence :
If articles are silent regarding interest on calls-in-arrears, the minimum rate of interest to be charged is _____________.

Options

• 5% p.a.

• 6% p.a.

• 8% p.a.

• none of these

Answer 1

If articles are silent regarding interest on calls-in-arrears, the minimum rate of interest to be charged is 5%.

Explanation:
Calls-in-arrears are defined as those dues which are not paid by the shareholders on the allotment or on calls within the fixed time.

The interest on Calls-in-arrears is to be paid by the defaulters and if nothing is provided in the articles then the interest of 5% p.a. is to be applied.