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Can a private limited company take loan from director? (LAW)

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This query is : Resolved

Author : Anonymous

( Author )
26 September 2011

If a director has taken a loan from a bank by pledging his FDs,and bank transfer the funds to company's loan a/c, comapny directly repaying the loan to bank on behalf of director,

then can it be treat as a loan taken from bank by the comapny or it should be treat as a unsecured loan from director?


RG - A Helping Hand

( Expert )
28 September 2011

Yes it would be considered as unsecured Loan to company from director. The same should be authorised by passing a board resolution u/s 292.

RG


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