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Conversion of unsecured loan into share application

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(Querist)
27 June 2011 1) Can a company convert the amount of unsecured loan obtained from holding company into share application money by passing an accounting entry.

2) Further is there any time limit for allotting shares after receiving share application money.
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Pravin Gupta CS

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Pravin Gupta CS (Expert)
28 June 2011 >> Yes Company can do so this but its require the approval of Board and may be approval of shareholder also...

>>> Share application money can be kept upto 12 months ( time limit not specified at anywhere), however in case of share application money recd from foreigner than share should be alloted within 6 month from the date of receiving such money as per FEMA
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Sudipta Kumar Mishra

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Sudipta Kumar Mishra (Querist)
29 June 2011 Thanks Pravin .....
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