Loan from director

This query is : Resolved

rajesh (Querist)
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25 June 2010 Whether loan taken from directors are to be mentioned in register to be maintained unders section 301 of the companies act 1956?

Srikant

Srikant (Expert)
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25 June 2010 Section 301 of Companies Act, 1956 requires every Company to maintain Register of Contracts entered with related parties as per provisions of Section 297 and Section 299.

And in your case, it is applicable.

Ankur Garg

Ankur Garg (Expert)
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25 June 2010 Section 297 is not applicable in our case.

Providing loan to the company does not automatically put director in the category of interested director u/s 299. So analyse carefully if director is interested in the transaction in anyway then entry in 301 register in necessary otherwise there is no need to do the same.

Thanks

CA G. SURYANARAYANAN

CA G. SURYANARAYANAN (Expert)
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25 June 2010 Mr.Ankur Garg's opinion seems to be right. If there is no element of contract existing in the transaction, there is no need to enter in the register.

CA. G. SURYANARAYANAN

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