Repayment of Loan by issuing equity shares

This query is : Resolved

yogesh mahajan (Querist)
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11 January 2010 Dear Madam/Sirs,

Can we repay an existing loan by issuing equity shares to the lenders?

Whether this would govern under provisions of payment of loans otherwise than account payee cheque/Demand draft?

Thanks in advance.

CA Pramod Jain

CA Pramod Jain (Expert)
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11 January 2010 u can repay it i think section 269t will apply to this case better u do this trf through bank ie first u repay the loan through chq/dd and then get this amt back as share capital through chq/dd.