How can a private limited company give loan to
a) director
b) HUF of director
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Loan by a Pvt Ltd company to director or HUF of director
Replies (4)
Quick Summary
Private Limited Company can give loan to a managing/whole time director of the company if:
- It is approved by a special resolution in the meeting and
- If this facility is given by a company to all its employees.
and
No company shall directly or indirectly give any loan to any other person or body corporate exceeding 60% of its paid up share capital, free reserves and share premium
Section 185 is not applicable to Pvt cos ,So Company if not a subsy of Public co(deemed public Co)then it may give loan to director ,subject to put it before board and fulfillment of following conditions
a) No body corporate is shareholder
b) Borrowings are less than 50 crore or 2x of paid up capital
c)Company didn't make default in repayment of loan
You also have to check AOA and Stipulations by lender
a) No body corporate is shareholder
b) Borrowings are less than 50 crore or 2x of paid up capital
c)Company didn't make default in repayment of loan
You also have to check AOA and Stipulations by lender
Section 185 is applicable to pvt Ltd section does not exempt pvt ltd. . pl offer comments if contrary
Read 5/06/2015 notification by MCA ,subject to conditions specified private company is exempted from 185...
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