We have drawn our conclusion on the basis of provisions of Company Act 2013
Meaning of drawings – Drawing means withdrawal of money from the capital by a partner from partnership firm for personal purposes
Drawings in relation to a company:
Company being an artificial person generally withdraws money from the partnership as disinvestment.
Excess withdrawal of capital by a company from LLP:
According to Rule 2 (c) of Acceptance of Deposits Rules, “Deposits includes any receipt of money by way of deposits or loan or in any other form, by a company unless otherwise exempted”
Thus the withdrawal from LLP (in excess of capital) may be treated as deposits and the same can be treated as deposits in “other forms”.
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Pankaj Kabra
The Company Law Desk
CAclubindia
