conversion of loan into share capital
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
13 January 2011
Whether unsecured loan of a director can be converted into Share Capital of the private company ?
CA Sanat Pyne
(Expert)
14 January 2011
There is no restriction either under IT Act or under Companies Act.But , it is advisable to get a confirmation letter from the loan provider to treat it as share application money. Share application form can also be signed by the loan provider to company.
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