loan to relatives
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
05 July 2010
Dear Sirs
What are the consequences , if a private limited company pays interest free advances of Rs 30 lacs to the relative of the director.
Pl. guide me
Regards
What are the consequences , if a private limited company pays interest free advances of Rs 30 lacs to the relative of the director.
Pl. guide me
Regards
Ankur Garg
(Expert)
07 July 2010
In my opinion there are no adverse consequences if a company provide such loan. However this is a case of section 295 loan to director where prior CG approval is required.
But in your case it is fine as you are a private company and section 295 is not applicable to a pvt. company.
But such transaction must be supported by a board resolution and director must disclose his interest in the transaction u/s 299
Regards
But in your case it is fine as you are a private company and section 295 is not applicable to a pvt. company.
But such transaction must be supported by a board resolution and director must disclose his interest in the transaction u/s 299
Regards
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