Loan to Pvt. Ltd.Co., by Director
This query is : Resolved
09 July 2011
Dear Sir,
Can Directors give a loan (on interest) to a Pvt. Ltd. Co. in which they are directors ?
thanks
anckoora
Can Directors give a loan (on interest) to a Pvt. Ltd. Co. in which they are directors ?
thanks
anckoora
09 July 2011
yes, pvt ltd company can taken unsecured loan from directors and their relatives
09 July 2011
yes the directors can give but the interest rate should be as per prevailing market rates.
09 July 2011
But sir, they are taking remuneration from that pvt. ltd. co. In this case also, they can give unsecured loan to co ??
anckoora
anckoora
09 July 2011
yes, if director getting remuneration from company then he also give unsecured loan to company
09 July 2011
The company should obtain a confirmatory letter also from the director concerned, stating that the money lent to the company is not borrowed by him/her. This is for the compliance of the Companies Act,1956.
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