Redeemable preference share are those share which are purchased back by the company subject to the conditions laid down in the articles and section 154 of the act provide that a company limited by share may, if so authorized by the articles, issue preference share which are or at the option of the company are liable, to be redeemed. This section specifies the following rules relating to the redemption.
01 Such shares shall not be redeemed except out of profit of the company.
02 Such shares shall be redeemed unless they are fully paid.