Loan from director

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Madhusudan Kabra (Querist)

02 February 2012 If a coMpany accepts loans from its directors/ their relatives/ shareholders...... is it require to comply with compliance of section 58A.(Public deposit)

Regards

Madhusudan

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

02 February 2012 i) In case of public limited companies compliance of section 58A is mandatory.
ii) In case of pvt ltd companies, no need of compliance except a declaration,in case lender is director, that money lent is his / her own money.

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CS SIDDHARTHA BANIK

CS SIDDHARTHA BANIK (Expert)

02 February 2012 Dear warriers sir, Initially I had the same opinion like you. But recently I have come across a statement from a reputed professional that notification 189 dated 12/3/2004 put the directors of pvt. And public co. on the same footing. But I have not seen the copy of the said notification.

Thanks,

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CS SIDDHARTHA BANIK

CS SIDDHARTHA BANIK (Expert)

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

02 February 2012
Banik Ji

I have gone through Notification 189(E) dated 12/3/2004. The amendment made therein is the declaration ,as I said in my earlier reply, should be obtained also from relative of the director and member in addition to the director.
I reiterate that in the pre as well as post amended situation's for the purpose of 58A, pvt ltd and public limited companies are not in the same footing.

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