Section 133, The Companies Act, 2009

(1) The provisions of this section shall apply in respectof redemption by a company of any redeemable preference shares issued by it under section 101. (2) The shares shall not be redeemed unless they are fully paid, and redemption shall be made only out of – (a) profits of the company which would otherwise be available for dividends; or (b) the proceeds of a fresh issue of shares made for the purposes of the redemption. (3) Before the shares are redeemed, the premium, if any, payable on redemption, shall be provided for out of the profits of the company or out of the company’s share premium account. Certification of transfers. Redemption of redeemable preference of 90 91 (4) Where shares are redeemed otherwise than out of the proceeds of a fresh issue, there shall, out of profits which should otherwise have been available for dividend, be transferred to a reserve fund to be called “the capital redemption reserve fund”, a sum equal to the nominal amount of the shares redeemed, and the provisions of this Act relating to the reduction of the share capital of the company shall, except as provided in this section, apply as if the capital redemption reserve fund were paid-up share capital of the (5) Subject to the provisions of this section, the redemption of preference shares may be effected on such terms and in such manner as are provided by the articles of the company.