Company's act - 58 a

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

26 August 2013 Dear all,

I would like to know that if company availed deposits from partnership firm under which only one partner is relative .. thn is it violation of 58 -A Company's act or not? I have confusion regarding the same.

Please also inform cousin is relative as per company's Act.

Thanking You

Ajay Mishra

Ajay Mishra (Expert)
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26 August 2013 Hi

Deposits from Partnership firm
Acceptance of deposit by a private company from a partnership firm:—
(a) If all partners of the firm are also the directors of a private company, such private company can accept unsecured loans/deposits from the firm. This case will be covered under rule 2(b)(ix) i.e. such a deposit is an exempted deposit.
(b) If all partners of a firm are not the directors of a private company i.e. some of them are the directors and remaining are the shareholders, still private company can accept deposit from the firm.
(c) If all partners of a firm are not the directors of a private company i.e. some of them are the directors, some of them are shareholders and remaining are relatives of a partners who is a shareholder. This case is not covered under rule 2(b)(ix).
(d) Where some partners are directors in a private company and remaining partners are not their relatives, private company cannot accept deposits from such firm.

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