Deposit or loan
This query is : Resolved
23 November 2013
An unlisted public company's director has brought in cash in the company. Whether it should be treated as loan or deposit?
23 November 2013
Purely loan, no question of deposit for such amount
Message likes :
1 times
23 November 2013
It will be treated as loan and it will not be considered as deposit, because loan taken from director is not considered as deposit.
Message likes :
1 times
23 November 2013
Providing finance to the company may not be considered as or equated to sale of goods or materials to the company. So also, the same would not tantamount to supply of any services by a director to the company. The consent of the Board of directors pursuant to section 297 would not, therefore, be required. Whereas providing funds to the company may not be considered as a contract falling u/s 297, the same is definitely an arrangement in which director is directly or indirectly interested or concerned and therefore, the disclosure pursuant to section 299 would invariably be required to be made to the Board of directors of the company. Even after disclosing his interest, the concerned director should not take undue advantage because his position is very much like that of a trustee as was held in Kashinath v New Alok Ginning & Pressing Co. Ltd. (1950) 20 Comp Cas 225 (Nag).
Providing finance to the company may not be considered as or equated to sale of goods or materials to the company. So also, the same would not tantamount to supply of any services by a director to the company. The consent of the Board of directors pursuant to section 297 would not, therefore, be required. Whereas providing funds to the company may not be considered as a contract falling u/s 297, the same is definitely an arrangement in which director is directly or indirectly interested or concerned and therefore, the disclosure pursuant to section 299 would invariably be required to be made to the Board of directors of the company. Even after disclosing his interest, the concerned director should not take undue advantage because his position is very much like that of a trustee as was held in Kashinath v New Alok Ginning & Pressing Co. Ltd. (1950) 20 Comp Cas 225 (Nag).
Message likes :
1 times
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Fixe term employment
- Is any professional CA is here please reply
- Foreign lottery ticket bought online from India: legality, tax and consequences
- Putting a heading on received mail
- Section 50-fixed asset-->building ceases to exist
- Reprocessing of rectification order AY 2025-26
- FTS Taxable under 115A
- EXPORT BILL UNDER LUT FREIGHT CHARGE INCLUED IN INVOICE IT LIABLE TO TAX
- Gift Received from nonblood relative
- Experts need help
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- STATUTORY AUDIT OF A SMALL PRIVATE COMPANY INCORPORATED ON 28.03.2025
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
- Resigning a auditor from the company for misconduct
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
- CALCULATION OF DEFFERED TAX - OP BL IS DTL & CURRET IT DTA
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
