Dear All,
X ( private limited) is a holding company of B ( private limited).
Now the directors & their relatives of X ( private limited) wants to give unsecured loans / deposits to B ( private limited) which is a subsidiary of X ( private limited).
Whether the said deposits are exempted under Deposit rules?
Please clarify.
Ramesh
kuralla_babu @ yahoo.com
As per Section 3(1)(iii) a Private Company can not accept deposits other than its members, directors or their relatives.
And as per Comapnies (Acceptance of Deposit) Rules, 1975 deposit accepted by a Private Company from its Directors, members and their relatives are exempted deposit.
Therefore, a Private Company can only accept deposits from its Directors, Members and their relatives and deposit rules would not apply on it and it will be shown as unsecured loans.
Sec. 58A and Deposit Rules are not applicable on Private compalnies.. this will be treated as unsecured loan.. sec. 292 of companies act applicable here.
Dear All,
Here
X (private Limited co) is holding company,
B (private limited) subsidiary of above X (private Limited co),
B is also an NBFC non deposit company
My query is Directors &their relatives of X (private Limited co) which is holding company wants to give Unsecured loans to its subsidiary B (private limited). What are the rules applicable?
I think here deposit rules will be having a role to play as directors are giving the loan in their individual capacity and not the holding company
otehr esteemed views are awaited please
CAclubindia
