MCA1 min read
Preference Shares
Shares that carry preferential rights over equity shares in payment of dividend and repayment of capital upon winding up under Section 43 of Companies Act 2013. Can be cumulative or non-cumulative, convertible or non-convertible.
Last updated: 17 May 2026
Frequently Asked Questions (FAQs)🔗
Q1. What is Preference Shares in Indian corporate law?▼
Shares that carry preferential rights over equity shares in payment of dividend and repayment of capital upon winding up under Section 43 of Companies Act 2013. Can be cumulative or non-cumulative, convertible or non-convertible.
Q2. Why is Preference Shares important for compliance?▼
Preference Shares is governed by the Ministry of Corporate Affairs under the Companies Act, 2013. Understanding this concept is essential for ensuring regulatory compliance, avoiding penalties, and making informed corporate decisions in India.
Q3. Who should know about Preference Shares?▼
Preference Shares is relevant for company secretaries, compliance officers, chartered accountants, corporate lawyers, board members, and all professionals dealing with MCA regulatory matters in India.
Contextual Analysis & Regulatory Updates🔗
Read our latest analysis and critical updates on corporate circulars related to MCA:
MCA Advisory: Beware of High-Return Promises by Non-Compliant Nidhi Companies (September 2026)
Published: 25 September 2026
AOC-4 Filing for OPCs: FY 2025-26 Deadline Is 27 September 2026 — Complete Filing & Penalty Guide
Published: 24 September 2026
Form MGT-7 and MGT-7A: The Complete Annual Return Guide — Due Dates, Filing Process on MCA V3, Fees, Penalties and 2026 Updates
Published: 16 September 2026