Loan by one company to one person company
This query is : Resolved
04 October 2024
A one person has accepted a loan from another private limited company .The director is both director in one person company and private limited company.Can accept it the same?Can we show that as unsecured Loan?
05 October 2024
Section 185(2) allows a company to give loans to any person/entity in whom any of the directors are interested in subject to certain conditions.
The conditions which are to be fulfilled for advancing loans or providing guarantee or security to the person in whom the director is interested is-
The company must pass a special resolution in general meeting.
The borrowing company must utilise the loan granted for its principal business activities.
The explanatory statement to the notice of the general meeting in which such a resolution for granting the loan is passed should disclose:
full particulars of the loans or guarantee given or security provided and
purpose for which the loan or guarantee or security is proposed to be utilised by the person receiving the loan.
The conditions which are to be fulfilled for advancing loans or providing guarantee or security to the person in whom the director is interested is-
The company must pass a special resolution in general meeting.
The borrowing company must utilise the loan granted for its principal business activities.
The explanatory statement to the notice of the general meeting in which such a resolution for granting the loan is passed should disclose:
full particulars of the loans or guarantee given or security provided and
purpose for which the loan or guarantee or security is proposed to be utilised by the person receiving the loan.
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