CAN A LOAN BE GIVEN TO A SHAREHOLDER ?

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This query is : Resolved

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Yes, a private limited company can provide loans to its shareholders under Section 186 of the Companies Act 2013. However, loans to directors are restricted under Section 185. If a loan is given under Section 186, a special resolution is typically required, and this must be filed with the MCA.

Kavita R

Kavita R (Querist)

04 December 2021 Can a loan be given to a shareholder in case of a Private Limited company, if yes then which section states that under CA 2013? if not which section restricts the same. Please clarify....

B Sathyanarayanan

B Sathyanarayanan (Expert)

04 December 2021 yes a Private Limited company can give loan to share holder undersection 186 and but loan to director cannot be given under section 185 .

Kavita R

Kavita R (Querist)

15 December 2021 So u/s 186 do we require to pass special resolution ?

B Sathyanarayanan

B Sathyanarayanan (Expert)

16 December 2021 yes same has to be filed with mca

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