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

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.