Unsecured Loan
This query is : Resolved
09 July 2010
Dear Sir,
kindly clarify the following problems,
1) Can a Private Limited Comapany give unsecured loan to a proprietorship firm? If yes, whether the firm will repay the loan within the current year or the firm can repay in next year also?
kindly clarify the following problems,
1) Can a Private Limited Comapany give unsecured loan to a proprietorship firm? If yes, whether the firm will repay the loan within the current year or the firm can repay in next year also?
09 July 2010
Yes a Pvt Ltd Co. can give loan to a Firm. thereis as such no need to repay it in same yr. ALso also see sec 2(22)(e) of the Income Tax Act.
09 July 2010
Companies Act, 1956 so far has been liberal to the Private Limited Companies.
So a Pvt Ltd Co can give / take loan (unsecured/ secured) to /from a Proprietorship /Partnership Firm / Company.
Company Law is also silent about the period of Repayment of interest and or Principal.
So A Pvt. Ltd. Co, can arrange its fund as per its suitability.
I think You are asking from CARO point of View.
If your query is related to CARO, then in Audit Report you can simply mention that whether the Co has taken any loan or not and if yes then whether the terms and conditions of such loan and repayment thereof are prejudicial to the interest of the Company.
Other Formalities in this regard are,
Disclosure of Interest of Directors.
You can refer Sec 299,297,301,372A for your personal knowledge.
So a Pvt Ltd Co can give / take loan (unsecured/ secured) to /from a Proprietorship /Partnership Firm / Company.
Company Law is also silent about the period of Repayment of interest and or Principal.
So A Pvt. Ltd. Co, can arrange its fund as per its suitability.
I think You are asking from CARO point of View.
If your query is related to CARO, then in Audit Report you can simply mention that whether the Co has taken any loan or not and if yes then whether the terms and conditions of such loan and repayment thereof are prejudicial to the interest of the Company.
Other Formalities in this regard are,
Disclosure of Interest of Directors.
You can refer Sec 299,297,301,372A for your personal knowledge.
Message likes :
1 times
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- TDS 194-T applicability
- GST ITC REVERSE
- Fixe term employment
- Is any professional CA is here please reply
- TDS on TRUST
- Consolidated financials
- Putting a heading on received mail
- Withdrawal in cash from partners capital account by partner
- TDS on Complimentary "Desi Ghee and Gold Coin" Provided to KBC Contestants
- RCM ISSUE ON RENT AND TRANSPORTATION CHARGES
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- STATUTORY AUDIT OF A SMALL PRIVATE COMPANY INCORPORATED ON 28.03.2025
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
- Resigning a auditor from the company for misconduct
- RCM @ 5% on Hamali charges, Transport Charges, Unloading charges we take ITC or not
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
