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Loan from Director to Private Limited company

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(Querist)
03 May 2011 1. A director, not a share holder of the Company (as per the articles of the company no need for acquiring qualification shares by a director), gives loan to a private limited company Whether this loan will be violation under S.58A. Such director may be Technical or directorship to an expert.

2. From which relatives of a director a private limited company can borrow funds/can take loan?
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Bhaskaran Chackrapani Warrier

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Bhaskaran Chackrapani Warrier (Expert)
04 May 2011 1) In the case of Pvt Ltd companies loan from directors,whether or not holding shares, is exempted from the purview of section 58A Provided that the director from whom
money is received, furnishes to the company at the time of giving the
money, a declaration in writing to the effect that the amount is not being
given out of funds acquired by him by borrowing or accepting from
others.
2) For list of relatives ,pl see section 6 along with schedule 1A (contains 22 entries) of the Companies Act,1956.
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CA. Krishna K Neeraj

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CA. Krishna K Neeraj (Expert)
04 May 2011 Agee with the expert's view
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