Section 185
This query is : Resolved
Nitin Gupta
(Querist)
17 June 2016
If a listed Co. give guarantee to another company and after few months the director of guarantee Co. become director in guarantor Co., whether it is voilation of Section 185
Jatin Bajaj
(Expert)
19 June 2016
TO ATTRACT SECTION 185, IT MUST BE IN THE INTREST OF THE DIRECTOR PERSONALLY , THEN ONLY SECTION 185 WILL BE APPLICABLE OTHERWISE IT SHALL NOT BE APPLICABLE, IF IT ACTS AS A NOMINEE OF COMPANY.
aCCORDING TO SECTION 185, NO COMPANY SHALL PROVIDE LOAN OR GURANTEE TO DIRECTOR OR ANY OTHER PERSON IN WHOM DIRECTOR IS INTRESTED.
fOR EXAMPLE. ABC LIMITED PROVIDE LOAN OR GURANTEE TO MR A , WHO IS THE DIRECTOR OF BOTH ABC LIMITED COMPANY AND XYZ LIMITED COMPANY. THEN IN SUCH A CASE , SECTION 185 IS ATTRACTED AND IT IS THE VIOLATION OF SECTION 185
aCCORDING TO SECTION 185, NO COMPANY SHALL PROVIDE LOAN OR GURANTEE TO DIRECTOR OR ANY OTHER PERSON IN WHOM DIRECTOR IS INTRESTED.
fOR EXAMPLE. ABC LIMITED PROVIDE LOAN OR GURANTEE TO MR A , WHO IS THE DIRECTOR OF BOTH ABC LIMITED COMPANY AND XYZ LIMITED COMPANY. THEN IN SUCH A CASE , SECTION 185 IS ATTRACTED AND IT IS THE VIOLATION OF SECTION 185
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