Unsecured loan
This query is : Resolved
Shikha gupta
(Querist)
28 June 2012
Can a Private limited Company lend money to a Partnership firm?
If yes then what formalities or procedure to be followed?
If yes then what formalities or procedure to be followed?
CA CS Amit S. Kedia
(Expert)
28 June 2012
A private company can give the loan to a partnership firm provided-
Firm is not related party and only surplus money can be given as a loan otherwise it may contravene the object clause of the MOA.
Firm is not related party and only surplus money can be given as a loan otherwise it may contravene the object clause of the MOA.
Shikha gupta
(Querist)
28 June 2012
Thank you so much Amit Sir.
I have one query more regarding this , in case one of the director is a partner in the partnership firm to which company wants to give unsecured loan or make a investment, is it possible for the company to do that?
I have one query more regarding this , in case one of the director is a partner in the partnership firm to which company wants to give unsecured loan or make a investment, is it possible for the company to do that?
CA CS Amit S. Kedia
(Expert)
28 June 2012
how much % of share director holds in the company?
Shikha gupta
(Querist)
28 June 2012
Director has 50% share
CA CS Amit S. Kedia
(Expert)
28 June 2012
It will be deemed dividend u/s 2(22)(e) if the director is entitled to 20% or more of profits/loss of the firm.
However, dividend shall be limmited to accumulated profit.
Section 297 of companies act shall also get attracted.
However, dividend shall be limmited to accumulated profit.
Section 297 of companies act shall also get attracted.
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