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Applicability of section 297 and 299

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Querist : Anonymous

Querist : Anonymous (Querist)

08 March 2013 A NEWLY INCORPORATED COMPANY GAVE LOAN TO A FIRM IN WHICH ALL PARTNERS ARE DIRECTORS OF THE COMPANY(INTERESTED PARTY RELATION. WHETHER THERE IS ANY APPLICABILITY OF SECTION 297&299 APART FROM SECTION 295(LOAN TO DIRECTORS)

Ajay Mishra

Ajay Mishra (Expert)
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08 March 2013

Section 297 does not apply to:

1. Giving or taking loans.

2.Contract in respect of immovable property (as it is not 'good' ).{Letter No. 9/4190-CL-X dated 27.03.1990}.

3.Contract between two public Companies. 4.Contract of employment of director or managing or whole time director.[ Circuler No.8/11/75-CL-V dated 27.03.1975]

5.Contract for employment of relative of director.
6.Contract entered into by the company with the dealer on principle to principle basis. [Circuler No. FM 8/297/56-PR dated 02-08-1956]
7. Professional services of the nature given by firms of solicitors and advocates, etc.[circuler No. 8/11/75-CL-V dated 05.06.1975]
8.hiring of office premises on rent as the transaction is in immovable property. [Department Clarification dated 10-09-1990]

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