Companies Act, 1956
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Querist : Anonymous
Querist :
Anonymous
(Querist)
18 March 2011
Friends is it compulsory to file Form-8 when a company Takes a car Loan from bank to purchase a car for its employee/directors in the name of the Company/employee/directors.
pls also give any clarification/explanation on sec.125 or sec. 141 in this regard as a proof of the same...
pls also give any clarification/explanation on sec.125 or sec. 141 in this regard as a proof of the same...
18 March 2011
Not compulsory. The reason is as follows:-
As per section 125(4)(e) of the Companies Act, 1956 a charge, not being a pledge, on movable property of company is required to be registered under the said Act. In the instant case, the car has been hypothecated to the bank. In a case law Ideal Bank Ltd V. Pride of India Pictures Ltd it was held that hypothecation amounts to "pledge" though constructive and hence registration of charge is not required. However, such charge can be registered with the ROC ,if applied for, as per clarification given by DCA. (refer pp 1495 - A. Ramaiya's guide to Companies Act -2006 edn.)
As per section 125(4)(e) of the Companies Act, 1956 a charge, not being a pledge, on movable property of company is required to be registered under the said Act. In the instant case, the car has been hypothecated to the bank. In a case law Ideal Bank Ltd V. Pride of India Pictures Ltd it was held that hypothecation amounts to "pledge" though constructive and hence registration of charge is not required. However, such charge can be registered with the ROC ,if applied for, as per clarification given by DCA. (refer pp 1495 - A. Ramaiya's guide to Companies Act -2006 edn.)
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Querist : Anonymous
Querist :
Anonymous
(Querist)
19 March 2011
Thanks sir. i agree with your views. But is it mandatory to file Form-8 as per the DCA clarification as u said above or it is optional.
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