(1) Without prejudice to Section 64 of the Companies Act, 1963 and subject to the provisions of this chapter, a company to which this chapter applies may, if so authorized by its articles, issue redeemable preference shares which are liable at the option of the shareholder to be redeemed, and redeem them accordingly.
(2) The issue and redemption of shares by a company pursuant to paragraph (1) shall be subject to the following conditions -
(a) no redeemable shares shall be redeemed unless they are fully paid;
(b) no such shares shall be redeemed except out of profits available for distribution or out of the proceeds of a fresh issue of shares made for the purposes of redemption;
(c) the premium, if any, payable on redemption must have been provided for out of the profits of the company or out of the company's share premium account before the shares are redeemed.
(3) Shares redeemed under this Regulation shall be treated as cancelled on redemption and the amount of the company's is