Class 12 SP Letter for Payment of Dividend Electronically: Format & Solved Draft (ECS/NEFT)
Master the official format and scoring guidelines for the Class 12 Secretarial Practice (SP) letter on the Payment of Dividend Electronically (via ECS / NEFT) designed for the Maharashtra State Board (HSC) Commerce examination. Under Chapter 6 (Correspondence with Members), drafting an intimation letter to a shareholder regarding the direct electronic transfer of an interim or final dividend is one of the highest-scoring questions in Question 7 (Letter Writing), carrying a direct weightage of 5 marks. Below, you will find the official question scenario, step-wise marking distribution, statutory rules under the Companies Act, 2013, and a textbook-accurate solved model answer.
Statutory Rule (Section 123, Companies Act 2013): A company must pay declared dividends within 30 days from the date of declaration in the Annual General Meeting (AGM). Failure to disburse dividends within this statutory window attracts severe penal interest and legal liability. Electronic modes (ECS/NEFT/Direct Credit) ensure instant delivery and eliminate the risks of lost or forged physical warrants.
HSC Board Examination Question Scenario
In the HSC examination, this question is typically framed as follows:
"Draft a letter to a shareholder informing him / her regarding the payment of dividend electronically through ECS / NEFT, citing the resolution passed at the Annual General Meeting."
Official HSC Step-Wise Marking Breakdown (5 Marks)
Examiners evaluate secretarial correspondence based on structural precision and legal compliance:
| Component | Required Exam Content | Marks |
|---|---|---|
| Letterhead & Layout | Company Name, Registered Address, 21-digit CIN, Phone, Email, Website, Ref. No., and Date. | 1 Mark |
| Inside Address & Subject | Shareholder Name, Address, concise Subject Line, and formal Salutation. | 1 Mark |
| Body of the Letter | Reference to AGM resolution, dividend rate, tabular calculation schedule, and bank credit details. | 2 Marks |
| Sign-off & Subscription | Complimentary close ("Yours faithfully"), company name, and Company Secretary signature block. | 1 Mark |
| Total Marks | Question 7 (Attempt Any 2 Letters out of 3 = 10 Marks Total) | 5 Marks |
Solved Model Answer: Payment of Dividend Electronically
RELIANT MOTORS LIMITED
Registered Office: 88, Auto Park, Chakan, Pune - 410501.
CIN: L29100PN2010PLC123456
Phone: 020 - 2567 1122
Email: investors@reliantmotors.com
Website: www.reliantmotors.com
Ref. No.: RML/DIV/E-42/2026-27
Date: 10th November 2026
To,
Mrs. Sneha S. Patil,
Flat No. 4, Green Park Society, Shivaji Nagar,
Pune - 411005.
Subject: Intimation of Electronic Payment of Dividend via NEFT / ECS.
Dear Madam,
I am instructed by the Board of Directors to inform you that at the 16th Annual General Meeting (AGM) of the company held on 5th November 2026, the shareholders have unanimously approved the recommendation of the Board of Directors to pay a Final Dividend of ₹ 5.00 per Equity Share of the face value of ₹ 10/- each, for the financial year ended 31st March 2026.
We are pleased to inform you that as per the Electronic Clearing Service (ECS) mandate registered by you with the company and your Depository Participant, the dividend amount due to you has been directly remitted to your bank account. The details of the dividend payout are summarized in the schedule below:
| Registered Folio / Client ID | No. of Equity Shares Held | Dividend Per Share (₹) | Gross Dividend Amount (₹) | TDS Deducted (₹) | Net Dividend Paid (₹) |
|---|---|---|---|---|---|
| IN300123 - 45678910 | 200 | 5.00 | 1,000.00 | Nil | 1,000.00 |
The net dividend amount has been credited directly to your bank account as per the following details:
- Bank Name: State Bank of India
- Branch: Shivaji Nagar Branch, Pune
- Bank Account Number: *******4567
- Transaction Reference (UTR) No.: NEFT/SBI/261110/889977
- Date of Credit: 10th November 2026
Kindly verify the credit entry in your bank passbook or account statement. Please notify the company immediately if there is any discrepancy.
Thanking you.
Yours faithfully,
For Reliant Motors Limited
(Signature)
Ms. Kavita Sharma
Company Secretary
Examiner's Secret: 3 Critical Points for Scoring Full Marks
- No "Enclosure" Line: Because the payment is electronic (NEFT/ECS), no physical dividend warrant is attached. Writing an "Encl:" line here is a common factual error that costs marks!
- The 30-Day Rule: Make sure the date of the letter and the date of credit are within 30 days of the AGM date mentioned in the first paragraph.
- Clear Arithmetic in Table: Ensure that the calculation is mathematically accurate ($200 \text{ shares} \times ₹ 5.00 = ₹ 1,000.00$). If TDS is Nil, explicitly write "Nil".
Frequently Asked Questions (HSC Board Exam FAQs)
1. Within how many days must a declared dividend be paid to shareholders?
Under Section 123 of the Companies Act, 2013, declared dividends must be paid to eligible shareholders within 30 days from the date of declaration at the AGM.
2. What is the difference between an Interim Dividend and a Final Dividend?
An Interim Dividend is declared by the Board of Directors between two Annual General Meetings out of surplus profits. A Final Dividend is recommended by the Board and approved by the shareholders at the Annual General Meeting at the end of the financial year.
3. Why is electronic payment preferred over physical Dividend Warrants?
Electronic dividend payment prevents loss in transit, reduces administrative printing and mailing costs, avoids fraudulent encashment, and ensures immediate credit directly into the investor's bank account.