372a v/s 295

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

07 June 2012 Sir,

if public company gives loan to one of its group company which is under the same management and directors hold more than 25% voting power in both the companies whether section 295 of the companies act is applicable or we need to see only section 372A as it is of exclusive proviso for inter corporate loan.

Kindly suggest me the course of action to be taken in this regard for the loan made without approval of government and kinldy suggest me the case law if any on this .

Ajay Mishra

Ajay Mishra (Expert)
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08 June 2012 Hi

Section 295 deal with loan to directors of the public company.

Section 372A deal with loan to any other body corporate not covered under subsection (8) of this section.

This is the difference of section 292 and section 372A of the Companies Act, 1956.

Regards

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