Interest free loan taken from director

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This discussion addresses whether a director can provide an interest-free loan to their company, especially if the director themselves has borrowed the funds. It highlights that lending borrowed money to a company might contravene the Companies (Acceptance of Deposits) Rules, 2014, with potential exceptions depending on the company type. Further clarification on income tax provisions is sought.

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(Querist)
25 February 2020 Dear All ,

Any income tax provision applicable. if director giving interest free loan to it's company . and company not paid any interest to director . and director borrowed loan amount from bank on his own account.
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Amol S Joglekar

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Amol S Joglekar (Expert)
25 February 2020 director can give interest free loan to company
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Bhaskaran Chackrapani Warrier

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Bhaskaran Chackrapani Warrier (Expert)
25 February 2020 Director cannot lend borrowed money to company since it is a violation of Companies (Acceptance of Deposits) Rules,2014.
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Eswar Reddy S

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Eswar Reddy S (Expert)
29 February 2020 Check the type of company Pvt Ltd, public ltd,OPC, Section 8 Company.. There few exceptions
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Aashok Kumar Sharmapro badge online

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Aashok Kumar Sharmapro badge online (Expert)
25 May 2020 Agree with B.Chackrapani Warrier SIr.
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