Loan to company
This query is : Resolved
27 July 2010
A director of a public company has taken loan from a bank ask the bank to draw cheque in the name of the company. now company is paying installments and interest to the bank.
Is there any violation of law either companies act, or any other if so how can we make it good.
Thanx
Is there any violation of law either companies act, or any other if so how can we make it good.
Thanx
27 July 2010
Yes there is a violation of Section 295 as Company is giving indirect loan to Director.
As this require prior approval of Central Govt.
You can make it gud by Compunding.
As this require prior approval of Central Govt.
You can make it gud by Compunding.
Message likes :
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27 July 2010
Thanx but if I explain it more, the amount is being used by the company only and not by the director, moreover it is against the property of the director but the bank has not created any charge with roc
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