Loan to company
This query is : Resolved
08 November 2017
Can a Director of Private Company give loan to the Company? and Can the relative of the Director give loan to the Company Directly? If Yes, Then what is the procedure to be followed?
08 November 2017
1. Director can give loan to the company.
2. Relative of director can also give loan to the company but it should not be more
than the paid up capital and free reserve of the company. Notification 464(E) dated 5.6.2015.
But in both cases 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 loans or
deposits from others and the company shall disclose the details of money so
accepted in the Board’s report. The relative need not be a shareholder
of the company. Notification dated 15.9.2015.
2. Relative of director can also give loan to the company but it should not be more
than the paid up capital and free reserve of the company. Notification 464(E) dated 5.6.2015.
But in both cases 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 loans or
deposits from others and the company shall disclose the details of money so
accepted in the Board’s report. The relative need not be a shareholder
of the company. Notification dated 15.9.2015.
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