unsecured loan from outsider by private company.

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 May 2012 Can a private company accept unsecured loan from a person other than its shareholders,Directors and their relatives.

Please refer the Section and Act.

Please refer the section and Act for DEPOSIT and UNSECURED LOAN.

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
Follow

18 May 2012 The Companies Act prohibits a private company from accepting DEPOSITS from persons other than shareholder, directors or their relatives.

However, a private company can take unsecured loan from any person.

Message likes : 2 times

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
Follow

18 May 2012 Rule 2 (b) of Companies (Acceptance of Deposits) Rules, 1975 is extracted below:-

(b) "deposit" means any deposit of money with, and includes any amount borrowed
by, a company, but does not include......

In view of the above, 'unsecured loan' is a 'deposit' and a private limited company is, therefore, prohibited to accept 'unsecured loans' from outsiders / general public.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

jagadheswar goud

eddanapudi murali

SHIBSANKAR DEY

R Prabhudoss

SANJAY GOSALIA

Subscribe Now

unsecured loan from outsider by private company.

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

CA Final

Senior Executive

GST CONSULTANT

Accountant

Manager- Finance and Compliance

GST CONSULTANCY