Kindly Guide,
Ours is a Security Company (public limited) whose main object contains business of dealing in Shares, stocks, bonds and other securities. Now our Company has given loan to another private company above the limits prescribed under section 372A.
But Sub Section 8 of the Section says that -
"(8) Nothing contained in this section shall apply -
(a) to any loan made, any guarantee given or any security provided or any investment made by -
(i) a banking company, or an insurance company, or a housing finance company in the ordinary course of its business,
or a company established with the object of financing industrial enterprises, or of providing infrastructural facilities ;
(ii) a company whose principal business is the acquisition of shares, stock, debentures or other securities ;
(iii) a private company, unless it is a subsidiary of a public company ; "
Accordingly Company didnt passed a Special Resolution,
Kindly guide are we exempt from passing a Special Resolution for giving loan to another Company?
CAclubindia
