Sec. 185 , 186 of the companies act 2013

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Manoj Kumar Thirumalasetty (Querist)
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30 November 2016 How to check the compliances of sec. 185 & 186 of companies act 2013-Loan to directors, related & body corporate?

Whether it is sufficient if u check any loans given during the current financial year or we have to take into account of the loans already existing ?

Also please tell me how to understand the point in CARO 2016 i.e is it sufficient if no new loans are given during the current year?

Thanks in advance

Jatin Bajaj

Jatin Bajaj (Expert)
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30 November 2016 check weather special resolution is passed while giving Loan to managing Director as per section 185 of companies act
check weather form mgt 14 is passed in case of granting of loan by company to any other person or body corporate or employee as per section 186 of companies act
check that wether register of loan has been maintained by the Company in form MBP 2
And as per section 186 of the Companies Act, in addition to the Board approval, prior approval of Public Financial institution is required if any term loan is subsisting.
further , the company shall not give any further loan if there is default of loan installments or payment of intrest thereon to the public financial institutions

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Manoj Kumar Thirumalasetty

Manoj Kumar Thirumalasetty (Querist)
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30 November 2016 Thank you
and what if there is a loan given to directors already in the previous year before companies Act 2013 and small amount have been given additional to it. Is Special resolution required for that ?
Do the Auditor have to disqualify that in CARO 2016. for the small amount being added to that as normally we will check the compliance at the time of giving the loan?

Thanks in advance